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rrHE  ATTACK 


UPON    THK 


Legislature   of  1874-75, 


CONTAINING 


Summons,  Complaint,  Affidavit  and  Bonds  Filed 
by  Josiah  Turner,  Attorney,  4c, 


IN  THE  CASE  OF 


JOSEPH  HARRIS, 

Vs. 

D.  A.  Jenkins,  Public  Treasurer, 

AND 

Raleigh  &  Augusta  Air-Line  Railroad  Company, 


TOGETHER     WITH     THK 


Orders    of  Judge  Kerr  and  Opinion   of  Counsel  for 
Defendants. 


I 


Also,  an  Appendix,  Containing  Letters  of  Maj.  J.  C.  McRae,  John  M.  Moring 

and  Geo,  V.  Strong,  Esqs.,  and  Hons.  J.   W.  Graham  and  D,  A  Jenkins, 

and  Card  of  Directors  of  Raleigh   &   Augusta  Railroad  Co. 

EALEIGH: 

DAILY  NEWS  PRINT,  NO.   6,  MARTIN  STREET. 
1875. 


«<€* 


i) 


Digitized  by  the  Internet  Archive 

in  2012  with  funding  from 

University  of  North  Carolina  at  Chapel  Hill 


http://www.archive.org/details/attackuponlegislOOharr 


I 
THE  ATTACK 


UPON    THK 


Legislature  of  1874-75, 


CONTAINING 


Summons,  Complaint,  Affidavit  and  Bonds  Filed 
by  Josiah  Turner,  Attorney,  &c, 


IN    THE   CASE    OF 


JOSEPH  HAEKIS, 

Vs. 

D.  A.  Jenkins,  Public  Treasurer, 

AND 

Raleigh  &  Augusta  Air-Line  Railroad  Company, 


TOGETHER    WITH    THK 


Orders  of  Judge  Kerr  and  Opinion  of  Counsel   for 
Defendants. 


Also,  an  Appendix,  Containing  Letters  of  Maj.  J.  C.  McRae,  John-  M.  Moring 

and  Geo.  V.  Strong,  Esqs.,  and  Hons.  J.  W.  Graham  and  D.  A.  Jenkins, 

and  Card  o   Directors  of  Raleigh  &  Augusta  Railroad  Co. 


KALEIGH : 

DAILT    NEWS    PRINT,    NO.    6,    MARTIN    STREET. 

1875. 


"  HOUSE  BILL  No.  423." 

OR 

Laws  of  N.  C,  1874-'5,  Ch.  245. 

An  act  explanatory  of  certain  acts  and  to  enable  parties  hold- 
ing bonds  of  the  State  issued  for  internal  improvements 
under  acts  passed  prior  to  the  war  to  sell  the  same. 

Whereas,  Under  an  ordinance  of  Convention,  ratified 
March  eleventh  one  thousand  eight  hundred  and  sixty- 
eight,  and  an  act  of  Assembly  ratified  the  thirteenth  of  De- 
cember, one  thousand  eight  hundred  and  seventy-one,  the 
Raleigh  and  Augusta  Air-Line  Railroad  Company  is 
authorized  to  pay  off  $1,200,000  of  its  second  mortgage 
bonds  held  by  the  State  Treasurer  with  any  bonds  or  other 
indebtedness  of  the  State ;  and  whereas,  the  Public  Treas- 
urer expresses  a  doubt  whether  under  the  construction  of 
said  act  he  is  authorized  to  receive  bonds  issued  during  the 
war  for  internal  inprovement  purposes,  but  under  acts 
passed  prior  to  the  war';  and  whereas  further,  said  bonds  were 
issued  to  and  are  now  held  almost  exclusively  by  citizens 
of  this  State,  and  the  same  have  been  recognized  as  valid  by 
the  authorities  of  the  State  ;  now,  therefore, 

Section  1.  The  General  Assembly  of  North  Carolina  do 
enact,  That  it  was  the  true  intent  and  meaning  of  the  ordi- 
nance and  act  above  referred  to  authorize  and  empower  the 
Public  Treasurer  to  receive  any  of  the  aforesaid  internal 
improvement  bonds  in  execution  of  the  provisions  of  said 
act  and  ordinance. 

Section  2.  The  Public  Treasurer  be  and  he  is  hereby' 
authorized,  empowered  and  directed  to  receive  any  of  the 
internal  improvement  bonds  for  the  State  of  North  Carolina 
herein  before  described  which  may  hereafter  be  tendered 
under  the  provisions  of  said  act  and  ordinance  in  execution 
of  the  same. 

Section  3.  This  act  shall  be  in  force  on  and  after  its  rati- 
fication. 

Ratified  the  22nd  day  of  March,  A.  D.  1875. 


(3 


SUMMONS. 

Orange  County — In  tlie  Superior  Court : — Joseph  Harris, 
plaintiff,  against  Raleigh  and  Augusta  Air  Line  Railroad 
Campany  and  David  A.  Jenkins,  Treasurer  of  the  State 
of  North  Carolina,  W.  J.  Hawkins  and  P.  C.  Cameron, 
Directors  of  the  said  Company,  defendants  : — Summons 
for  Relief. 

State  of  North  Carolina  —To  the  Sheriff  of  Wake  Coun- 
ty: --Greeting. 

You  are  Hereby  Commanded  to  summon  the  Raleigh 
and  Augusta  Air  Line  Railroad  Company  and  David  A. 
Jenkins,  Treasurer  of  the  State  of  North  Carolina,  and  W.  J. 
Hawkins  and  P.  C.  Cameron  directors  of  the  said  Company, 
the  Defendants  above  named,  if  they  be  found  within  your 
County,  to  be  and  appear  before  the  Judge  of  our  Superior 
X3ourt,  at  a  Court  to  be  held  for  the  County  of  Orange  at  the 
Court  House  in  Hillsboro,  on  the  eighth  Monday  after  the 
first  Monday  in  September,  1875,  and  answer  the  complaint 
which  will  be  deposited  in  the  office  of  the  Clerk  of  the  Su- 
perior Court  for  said  County,  within  ten  days  from  the  date 
of  this  summons,  and  let  the  said  Defendants  take  notice 
that  if  they  fail  to  answer  the  complaint  within  that  time, 
the  Plaintiff  will  apply  to  the  Court  for  the  relief  demanded 
in  the  complaint. 

Herein  fail  not,  and  of  this  summons  make  due  return. 

Given  under  my   hand  and  the  seal  of  said  Court,  this 
14th  day  of  July,  1875. 

GEORGE  LAWS, 
Clerk  of  the  Superior  Court  of  Orange  County. 


BOND  FOR  COSTS. 

Orange  County  : — In  the  Superior  Court,  Joseph  Harris, 
against  the  Raleigh  and  Augusta  Air  Line  Railroad 
Company : — Bond  for  costs. 

We,  Joseph  Harris  the  plaintiff  and  Henry  N.  Brown 
and  Jas.  A.  Cheek,  our  Executors  and  Administrators,  are 
bound  to  the  Defendants,  Raleigh  and  Augusta  Air  Line 
Railroad  Company  in  the  above  entitled  action,  in  the  sum 
of  Two  Hundred  dollars.  This  obligation  to  be  void  upon 
the  condition  that  the  said  plaintiff,  Joseph  Harris,  shall 
pay  to  the  defendants,  all  such  costs  as  the  defendants  may 
recover  of  the  plaintiffs  in  said  action.  Otherwise  to  re- 
main in  full  force  and  effect. 

Witness  our  hands  and  seals,  this  15th,  day  of  July,  1875. 
(Signed,)  JOSEPH  HARRIS,      (Seal.) 

by  Josiah  Turner,  Att'y. 
(Signed,)  HENRY  N.  BROWN,  (Seal.) 
(Signed,)  JAS.  A.  CHEEK.  (Seal.) 


COMPLAINT. 

State  of  North  Carolina,  Orange  County,  Joseph  Harris  Plain- 
tiff, against  David  A.  Jenkins,  Public  Treasurer  of  North 
Carolina,  and  the  Raleigh  and  Augusta  Air  Line  Rail- 
road Company — Defendants. 

The  plaintiff  above  named  complaining  of  the  defendants 
above  named  on  behalf  of  himself,  a  citizen  and  resident  of 
North  Carolina  and  a  tax-payer  therein  and  pecuniarily  in- 
terested in  the  financial  affairs  of  the  State  and  subject  to  loss 
under  an  act  of  the  General  Assembly  of  North  Carolina, 
ratified  the  22d  day  of  March  1875,  entitled  an  act  explana- 


(5) 

tory  of  certain  acts  and  to  make  parties  holding  bonds,  is- 
sued for  internal  improvments,  under  acts  passed  prior  to 
the  war,  "  to  sell  the  same,"  and  all  other  citizens  and  tax- 
payers in  the  State  of  North  Carolina  affected  like  him  by 
said  act,  who  shall  in  due  time  come  in  and  ask  relief  and 
contribute  to  the  expense  of  this  action. 

Alleges: 

That  the  said  tax-payers  are  very  numerovs,  "  to  wit:  " 
more  than  one  hundred  thousand  in  number,  and  that  some 
of  them  are  unknown  to  the  plaintiff  and  cannot  with  dili- 
gence be  ascertained  by  him,  and  that  it  is  impossible  there- 
fore to  br'.ng  them  before  the  Court  in  this  action,  therefore 
he  sues  in  behalf  of  them  all. 

II.  That  the  defendant  David  A.  Jenkins  is  public  Treas- 
urer of  North  Carolina,  and  the  defendant,  the  Raleigh  and 
Augusta  Air  Line  Railroad  Company  in  North  Carolina,  is 
a  corporation  duly  created  and  organized  under  and  in 
pursuance  of  Acts  of  the  General  Assembly  of  North  Caro- 
lina, said  road  being  chartered  by  an  Act  of  General  As- 
sembly ratified  the  15th  day  of  February,  1861,  by  the 
name  of  the  Chatham  Railroad  Company,  the  name  of  which 
was  changed  to  Raleigh  and  Augusta  Air  Line  Rail  Road 
Company  by  act  of  General  Assembly,  ratified  13th  day  of 
December,  1871. 

III.  That  said  Chatham  Railroad  Company,  now  chair 
ged  to  Raleigh  and  Augusta  Air  Line  Railroad  Company, 
obtained  from  the  Treasurer  of  the  State  of  North  Carolina, 
under  an  ordinance  ratified  11th  of  March,  1868,  a  large 
number  of  State  bonds,  to  wit :  $1,200,000  in  amount,  and 
secured  the  payment  thereof  by  depositing  with  the  said 
Treasurer  mortgaged  bonds,  of  the  said  Railroad  Company, 
to  the  amount  of  $1,200,000,  said  bonds  bearing  date  August 
20th,  1868,  and  bearing  interest  at  the  rate  of  6  per  cent, 
payable  semi-annually. 

IV.  That  under  ordinance  of  Convention  ratified  11th  of 
March,  1868,  and  act  of  Assembly   ratified  13th  day  of  De- 


{6) 

cumber,  1871.  authorizing  the  Raleigh  and  Augusta  Air  Line 
Railroad  Company,  to  discharge  the  said  bonds  of  the  Chat- 
ham Railroad  Company,  the  said  Raleigh  and  Augusta 
Air  Line  Railroad  Company,  had  at  the  time  of  the  ratifi- 
cation of  the  Act  of  22d  March,  1875,  paid  off,  and  dischar- 
ged with  bonds  of  the  State  of  North  Carolina,  said  Rail- 
road bonds  to  the  amount  of  §710,000,  leaving  at  that  time 
in  the  Treasurer  of  North  Carolina  of  the  $1,200,000  mort- 
gaged bonds,  bonds  to  the  amount  of  $490,000. 

V.  That  said  mortgaged  bonds,  are  first  mortgaged  bonds 
on  the  said  Railroad  and  are  valuable,  worth  90  cents  or 
$1.00  in  the  dollar,  and  that  War  bonds,  i.  e.,  bonds  issued 
during  the  war,  are  worth  only  from  10  to  15  cents  in  the 
dollar. 

VI.  That  on  the  last  working  day  of  the  Session  of  the 
last  General  Assembly  of  North  Carolina  an  Act  entitled 
"an  Act  explanatory  of  certain  Acts  and  to  enable  parties 
holding  bonds,  of  the  State,  issued  during  the  war  for  inter- 
nal improvements  under  acts  passed  prior  to  the  war  to  sell 
the  same  was  passed  the  House  of  Representatives  and  sent  to 
the  Senate  and  passed  through  that  body  without  reference  to 
any  committee  and  without  having  been  explained,  and 
plaintiff  believes  without  having  been  read  except  by  the  title. 

VII.  That  since  the  ratification  of  the  last  named  Act, 
the  Raleigh  and  Augusta  Air  Line  Railroad  Company  have 
purchased  bonds  issued  during  the  war  and  worth  only 
from  10  to  15  cents  in  the  dollar,  and  discharged  and  paid 
off  of  the  said  mortgaged  bonds  to  the  amount  of  $190,000. 

VIII.  That  plaintiff  believes -from  information  and  from 
the  title  of  the  Act  of  22d  March,  1875,  which  recites  a  dif- 
ferent intent  from  the  body  of  the  Act,  10  wit :  the  title  says 
it  is  an  Act  "  to  enable  parties  holding  bonds  of  the  State 
issued  for  internal  improvements  under  acts  passed  prior  to 
the  war  to  sell  the  same.  "  When  the  intent  of  the  Act  is 
as  follows,  expressed  by  section  2 :  The  Public  Treasurer 
be,  and  he  is  hereby  authorized,  empowered  and  directed  to 

f 


(7) 

receive  any  of  the  internal  improvement  bonds,  of  the  State 
of  North  Carolina,  herein  before  described,  which  may  here- 
after be  tendered  under  provisions  of  said  Act  and  Ordi- 
nance and  in  execution  of  the  same,  the  first  section  declar- 
ing simply  that  it  was  the  intent  of  the  said  ordinance,  and 
Act  that  the  Treasurer  should  receive  the  internal  improve- 
ment bonds,  in  exchange,  and  from  the  fact  that  the  pream- 
ble calls  these  bonds  "second  mortgage  bonds,"  when  they 
are  first  mortgage  bonds,  that  the  said  Act  of  22d  of  March, 
1875,  was  passed  through  the  Legislature  by  trick  and  de- 
ception, without  having  been  read  three  times  as  the  Con- 
stitution requires 

IX.  The  plaintiff  further  alleges,  that  the  State  bonds 
given  to  the  Company  in  exchange  of  the  mortgage  bonds 
of  the  Railroad  were  valuable  and  sold  for  four  or  five 
times  as  much  as  the  internal  improvement  bonds  issued 
during  the  war  and  with  which  the  said  Railroad  Compa- 
ny are  now  paying  off  and  discharging  the  said  mortgage 
bonds. 

X.  That  interest  has  been  accumulating  on  said  bonds 
since  the  20th  of  August  1868,  and  the  interest  on  some  of 
them  has  never  been  paid  and  a  large  sum  to  wit :  $89,000 
of  said  interest  is  now  due  and  unpaid,  said  interest  by  an 
ordinance  ratified  11th  of  March,  1868,  and  by  agreement  of 
said  Railroad  Company  with  the  State  as  expressed  in  the 
mortgage  of  the  20th  July,  1868,  and  registered  in  the  office 
of  the  Register  of  Deeds  for  Wake  County,  in  Book  26,  page 
189,  a  copy  of  which  is  hereunto  annexed  marked  "  A  "  and 
made  a  part  of  this  complaint,  was  due  and  payable  semi- 
annually, and  said  Company  have  violated  the  said  agree- 
ment and  broken  their  contract  with  the  State  of  North 
Carolina  in  failing  to  pay  said  interest  then  due. 

XL  The  plaintiff  is  informed  and  believes  that  the  de- 
fendant the  Public  Treasurer  of  North  Carolina  is  about 
to  receive  many  thousands  of  dollars  worth  of  the  aforesaid 
bonds,  issued  during  the  war  and  worth  15  ©ents  in  the 


(8) 

dollar  in  discharge  of  the  aforesaid  mortgage  honds  worth 
90  cents  or  $1.00  in  the  dollar.  Whereby  the  plaintiff  and 
all  other  citizens  of  North  Carolina  and  tax-payers  will  be 
greatly  damaged,  wherefore,  the  plaintiff  demands  Judg- 
ment. 

First  that  David  A.  Jenkins,  Public  Treasurer  of  North 
Carolina  be  restrained  by  Injunction  from  receiving  said 
State  bonds  issued  during  the  war  in  discharge  of  the  said 
mortgage  bonds  of  the  Chatham  Railroad  Company,  and 
that  each  and  every  Agent,  Attorney,  Servants  and  Counsel- 
lor of  the  said  David  A  Jenkins  be  in  like  manner  restrain- 
ed by  injunction. 

2d.  That  the  Defendants,  the  Raleigh  and  Augusta  Air 
Line  Railroad  Company,  its  officers  and  agents,  be  restrain- 
ed by  injunction  from  accepting  said  mortgage  bonds  held 
by  the  Public  Treasurer  of  North  Carolina,  which  may  be 
tendered  them  by  the  defendant,  the  said  David  A.  Jenkins. 
Plaintiff  has  commenced  action  by  issuing  summons  to 
Orange  Court. 

3d.  And  that  the  Plaintiff  have  his  cost  in  this  action. 

JOSIAH  TURNER, 

for  Plaintiffs. 


"A"— COPY  OF  MORTGAGE. 

State  of  North  Carolina,   Wake  County,  July,  20th  1868. 

Whereas,  the  Convention  of  North  Carolina  by  an  ordi- 
nance ratified  the  11th  day  of  March,  1868,  entitled  an  or- 
dinance to  amend  the  charter  of  the  Chatham  Railroad 
Company,  authorizing  the  issue  of  coupon  bonds  of  the 
State  to  an  amount  not  exceeding  twelve  hundred  thousand 
dollars  to  the  Chatham  Railroad  Company,  said  Company 
to  deposit  with  the  Public  Treasurer  the  coupon  bonds  of 
said  Company  as  in  said  ordinance  set  forth,  and  secure  the 


0) 


principal  and  interest  of  said  bonds  issued  by  the  Chatham 
Railroad  Company,  it  was  ordained  that  the  State  of  North 
Carolina  shall  have  a  lieu  upon  certain  estate  and  rights  of 
said  Company  in  said  ordinance  and  hereunto  set  forth, 
which  lein  shall  be  more  effectually  secured  by  a  first  mort- 
gage duly  executed  by  said  Company,  and  whereas,  said 
Chatham  Railroad  Company  by  the  Stockholders  did  accept 
said  amendment  to  the  Charter,  and  did  subsequently  de- 
posit with  the  Treasurer  the  coupon  bonds  of  said  Company 
dated  1st  day  of  April  1868  bearing  six  per  cent  interest. 
the  principal  payable  at  the  end  of  thirty  years  from  the 
date  thereof,  the  coupons  of  interest  payable  semi-annually 
at  the  National  Bank  of  the  Republic  in  the  City  of  New 
York,  being  the  same  time  and  place  as  designated  by  the 
Public  Treasurer  for  payment  of  principal  and  interest  of 
the  bonds  of  the  State  to  the  Chatham  Railroad  Company 
to  be  issued. 

Now,  therefore,  this  deed  of  mortgage  executed  this  July 
20th,  1868,  by  the  Chatham  Railroad  Company,  to  carry 
into  effect  said  ordinance  and  for  the  considerations 
aforesaid,  as  well  as  of  ten  dollars  paid,  hath  bargained  and 
sold  and  by  these  presents  doth  bargain  and  sell  unto  the 
State  of  North  Carolina,  all  the  estate  of  said  Company,  both 
real  and  personal,  which  they  may  now  have  or  may  here- 
after acquire  between  the  City  of  Raleigh  and  the  Gulf,  the 
terminus  of  said  Railroad  in  the  Coal  Fields,  including  that  at 
both  points,  together  with  all  the  rights,  franchises  and  pow- 
ers thereto  belonging  or  appertaining  or  that  which  may 
hereafter  belong  or  appertain  to  said  Company,  to  have 
and  to  hold  to  said  State  of  North  Carolina.  Provi- 
ded, nevertheless,  that  if  said  Chatham  Railroad  Com- 
pany shall  pay  and  continue  to  pay  to  the  State 
the  semi-annual  interest  on  its  bonds  within  twen- 
ty-four months  next  ensuing  after  the  said  interest  shall  be- 
come due,  and  shall  further  pay  the  principal  of  said  bonds 
within  twelve  months  next  ensuing  after  the  said  principal 


10 


shall  have  matured  and  become  due,  then  the  foregoing 
conveyance  shall  be  void  and  of  no  effect,  otherwise  remain 
in  full  force  and  virtue*  and  it  is  further  covenanted  and 
agreed  that  if  the  said  Chatham  Railroad  Company  shall 
fail  to  pay  the  semi-annual  interest  on  its  bonds  for  twenty- 
four  months  after  each  interest  shall  become  due  or  to  pay 
the  principal  of  said  bonds  for  twelve  months  after  their 
maturity,  the  Board  of  Internal  Improvements  for  and  in 
behalf  of  the  State  may  enter  upon  and  take  possession  of 
all  the  property  herein  before  specified  and  dispose  of  the 
same  by  sale  so  as  to  protect  the  State. 

In  testimony  whereof  the  Chatham  Railroad  Company 
by  its  President,  W.  J.  Hawkins,  and  two  of  its  Directors  and 
Stockholders, have  hereunto  signed  and  subscribed  this  day 
and  year  above  mentioned. 

W.  J.  HAWKINS, 
President  of  the  Chatham  Railroad  Company. 

C.  H.  K.  TAYLOR, 
Director  Chatham  Railroad  Company. 

GEORGE  LITTLE. 
Director,  Chatham  Railroad  Company. 
Witness  : — Thomas  Badger. 

Registered  in  Book  26,  Register  of  Deeds  office  Wake 
County,  page  189. 


JURAT. 

Joseph  Harriss,  against  David  A.  Jenkins  and  others: 

At  Chambers,  Jul}'  15th,  1875,  Josiah  Turner,  this  day 
appeared  before  me  and  swore  in  due  form  of  law  that  he 


(11 ) 

is  agent  and  attorney  for  the  plaintiff  in  the  above  entitled 
action  that  the  allegation  contained  in  the  complaint  so  far 
as  stated  on  his  own  knowledge  are  true,  that  so  far  as  sta- 
ted information  of  others,  he  believes  to  be  true. 

(Signed,)  JOSIAH  TURNER. 
Sworn  to  and  subscribed  before  me,   day  and  date  above 
written. 

(Signed,)  JOHN  KERR, 
Judge  &c,  7th  Judicial  District. 


INJUNCTION   ORDER. 

North  Carolina,  Rockingham  County — At  Chambers,  July  loth 

1875. 

Upon  the  plaintiffs  giving  bond  and  good  security  in  the 
sum  of  five  thousand  dollars  for  the  payment  to  the  defen- 
dants of  all  damages  they  may  sustain  by  reason  of  swear- 
ing out  of  the  restraining  order  in  case  the  plaintiff  fail  in 
his  action;  the  clerk  of  the  Superior  Court  of  Orange  Coun- 
ty, is  hereby  commanded  to  issue  summons  to  each  of  the 
defendants  to  appear  before  me  at  Greensboro  in  Guilford 
County,  in  the  Court  House  of  said  County  on  Wednesday 
of  the  first  week  of  the  next  regular  term  of  the  Superior 
Court  of  Guilford,  which  begins  on  the  1st  Monday  in  Sep- 
tember A.  D.,  1875,  there  and  then  to  show  cause,  if  any 
they  can,  why  the  prayer  of  the  plaintiff's  complaint  for  a 
perpetual  injunction  shall  not  issue  and  the  said  clerk  is 
also  directed  to  issue  an  order  commanding  defendant  Jen- 
kins to  abstain  from  receiving  from  the  other  defendants 
any  and  all  bonds,  which  may  be  tendered  him,  in  satifac- 
tion  of  the  mortgage  bonds  of  said  defendants,  now  in  his 
custody  as  Treasurer  of  the  State,  until  the  further  order 
of  the  Court. 

(Signed,)  JOHN  KERR, 
Judge  of  the  7th  Judicial  District,  of  North  Carolina. 


(12) 
INJUNCTION  BONO. 

Orange  County — Superior  Court: — Joseph  Harris,  plain- 
tiff, against  David  A.  Jenkins,  Public  Treasurer  of  North 
Carolina,  and  the  Raleigh  and  Augusta  Air  Line  Railroad 
Company. 

Whereas,  The  said  plaintiff,  Joseph  Harris,  has  applied 
for  an  injunction  against  the  above  named  defendants,  and 
an  order  has  been  made  by  the  Honorable  John  Kerr,  Judge 
of  the  Superior  Court  of  the  Seventh  Judicial  District, 
awarding  the  same  and  thereby  commanding  the  said  de- 
fendant, Jenkins,  to  abstain  from  receiving  from  the  other 
defendant,  the  Raleigh  and  Augusta  Air  Line  Railroad 
Company,  any  and  all  bonds  which  may  be  tendered  him 
in  satisfaction  of  the  mortgage  bonds  of  said  other  defen- 
dant now  in  his  custody  as  Treasurer  of  the  State  until  the 
further  order  of  this  Court:  now  therefore  we,  Joseph  Har- 
ris, Principal,  and  Simon  G.  Hays,  A.  Miller  and  Patrick 
McGowan,  sureties,  do  undertake  covenant  and  agree  with 
and  to  the  said  David  A.  Jenkins,  Public  Treasurer,  and  the 
Raleigh  and  Augusta  Air  Line  Railroad  Company,  defen- 
dants aforesaid,  in  the  sum  of  Five  Thousand  dollars  to  pay 
to  them  all  such  damages  as  they  may  sustain  by  reason  of 
such  injunction  not  exceeding  the  said  sum,  if  the  said 
Court  shall  finally  decide  that  the  plaintiff  is  not  entitled 
thereto  to  be  ascertained  according  to  law. 

In  testimony  whereof  we  do  hereunto  subscribe  our  names 
and  affix  our  seals  this  19th  day  of  July,  1875. 
Witness:  J.  B.  Bunting,  Clerk. 

(Signed,)  JOS.  A.  HARRIS,    {Seal.) 
(Signed,)  S.  G.  HAYS,  (Seal.) 

(Signed,)  A.  MILLER,  (Seal.) 

(Signed.)  P.  MeGOWAN,        (Seal.) 


State  of  ISiorth  Carolina,  Wake  County. 

On  this  the  17th  day  of  July,  1875,  before  me   personally 
appeared  Jos.  A.  Harris,  Patrick  McGowan,  Simrn  G.  Hays, 


■     (13) 

Alex,  Miller,  to  me  known  to  be  the  persons  who  executed 
the  foregoing  bonds,  and  personally  acknowledged  that  they 
did  execute  the  same.  And  the  said  Simon  G.  Hays  being 
dul}r  svrorn  says  that  he  is  a  resident  and  a  free  holder  in 
Wake  county,  and  is  worth  one  thousand  dollars  of  the 
foregoing  bonds,  exclusive  of  property  exempt  from  execu- 
tion, and  over  and  above  all  liabilities;  and  the  said  Alex. 
Miller,  being  duly  sworn,  says  that  he  is  a  resident  and  a 
free  holder  in  Wake  county,  and  worth  the  amount  of  four 
thousand  dollars  on  the  foregoing  bonds,  exclusive  of  prop- 
erty exempt  from  execution,  and  over  and  above  all  liabili- 
ties. 

Witness  my  hand  and  seal,  the  year  and  date  above  writ- 
ten. 

{Seal)        J.  N.  BUNTING, 
Clerk  Superior  Court  of  Wake  County. 


RESTRAINING  ORDER. 

Orange  County — Superior  Court : — Joseph  Harris,  plain- 
tiff, against  Raleigh  and  Augusta  Air  Line  Railroad 
Company,  defendants. 

THE  STATE  OF  NORTH  CAROLINA— To  David  A. 
Jenkins,  Public  Treasurer  of  North  Carolina. 

Whereas,  The  above  named  Joseph  Harris  has  sued 
out  of  the  office  of  the  Clerk  of  the  Superior  Court  of 
Orange  County  a  summons  against  you  a  defendant  as 
aforesaid,  returnable  before  the  Judge  of  the  Seventh 
Judicial  District,  at  Greensboro,  on  Wednesday  of  the 
first  week  of  said  term,  which  begins  on  the  1st  Monday 
in  September,  1875. 

And  has  filed  and  verified  by  his  oath  his  complaint  in 
said  cause. 


(14) 

And  whereas,  upon  such  complaint  and  affidavit  ex- 
hibited before  the  Honorable  John  Kerr,  Judge  of  the 
Superior  Court  of  the  Seventh  Judicial  District  in  this 
State,  and  he  has  thereupon  made  an  order  granting  to 
the  said  Joseph  Harris  an  injunction  as  therein  prayed 
for,  and  directing  me  to  issue,  on  the  said  plaintiff  giving 
bond  and  good  security  in  the  sum  of  Five  Thousand 
dollars  to  the  effect  the  said  Joseph  Harris  will  pay  to  the 
said  David  A.  Jenkins,  defendant  aforesaid,  such  damages 
not  exceeding  Five  Thousand  dollars,  as  the  said  defend- 
ant may  sustain  by  reason  of  said  injunction,  if  the  Court 
shall  finally  decide  that  the  plaintiff  was  not  entitled 
thereto. 

Now  therefore  we,  do  strictly  command  }7ou  and  enjoin 
you  to  desist  and  refrain  from  receiving  from  the  other 
defendants,  the  Raleigh  and  Augusta  Air  Line  Railroad 
Company,  any  and  all  bonds  which  may  be  tendered 
you  in  satisfaction  of  the  mortgage  bonds  of  said  other 
defendants  now  in  your  custody  as  Treasurer  of  the  State 
until  the  further  order  of  the  Court. 

In  testimony  whereof,  I,  George  Laws,  Clerk  of  said 
Superior  Court  of  Orange  County,  have  hereto  subscribed 
my  name  at  office  in  said  County  and  affixed  hereto  the 
seal  of  said  Court,  this  19th  day  of  July,  1875. 

GEORGE  LAWS, 
Clerk  Superior  Court  of  Orange  County. 


NOTICE  TO  DEFENDANTS  TO  SHOW 

CAUSE. 

Joseph  Harris,  Plaintiff,  against  David  A.  Jenkins,  Public 
Treasurer  of  the  State  of  North  Carolina,  and  the  Raleigh 
and  Augusta  Air  Line  Railroad  Company. 

STATE   OF   NORTH    CAROLINA— To    the   Sheriff    of 

Wake  County  : — Greeting. 

You    are    hereby    commanded  to    summons  David  A. 
Jenkins,  Public  Treasurer  of  the  State  of  North   Carolina, 


(15) 

and  the  Raleigh  and  Augusta  Air  Line  Railroad  Com- 
pany, if  they  he  found  within  your  county,  to  he  and 
appear  before  the  Hon.  John  Kerr,  Judge  of  the  Superior 
Court,  7th  Judicial  District,  at  the  Court  House  in 
Greensboro.  Guilford  county,  on  Wednesday  of  the  first 
week  of  trie  regular  term  of  the  Superior  Court  of  Guil- 
ford, which  begins  on  the  first  Monday  in  September,  A. 
D.  1875,  then  and  there  to  show  cause,  if  any  they  can, 
whv  the  prayer  of  the  plaintiff's  complaint  for  a  perpetual 
injunction  shall  not  issue. 

Witness:  George  Laws,  Clerk  of  said   Court,  19th  day   of 
Jul  v,  1875. 

GEORGE  LAWS, 
Clerk  Superior  Court  of  Orange  County. 


OPINION  OF  COUNSEL. 

The  undersigned  have  examined  the  papers  in  the  case 
of  Joseph  Harris,  plaintiff,  against  David  A,  Jenkins,  Public 
Treasurer,  and  others,  defendants,  depending  in  the  Superi- 
or Court  of  Orange,and  the  restraining  order  made  therein  by 
the  Judge  of  the  7th  Judicial  District,  of  which  Orange 
county  is  a  part,  and  are  of  opinion  that  the  proceedings 
are  irregular  and  the  order  without  warrant  of  law. 

I.  The  jurisdiction  of  proceedings  against  the  Publie 
Treasurer,  to  enforce  or  restrain  him  in  his  official  action, 
is  vested  in  the  Superior  Court  of  the  county  of  Wake  and 
to  be  exercised  by  the  Judge  of  the  6th  Judicial  District 
exclusively  after  the  award  of  an  injunction.  Batt.  Rev. 
ch.  17  (C.  C  P.)  sec.  67.  Alexander  vs.  Commissioners  of 
McDowell,  67  N.  C.  R.  330.  Jones  vs.  Commissioners  of 
Bladen,  69  N.  C.  R.  412.  Steele  vs.  Commissioners  ef 
Rutherford,  70  N.  0.  R.  137. 

II.  But  independently  of  the  restriction  in  actions  against 
public  officers,  none  of  the  parties  necessary  to  confer  juris- 


(16) 

diction  are  represented  to  reside,  nor  as  we  are  informed, 
do  any  of  them,  plaintiff  or  defendants,  reside  in  Orange 
county,  except  P.  C.  Cameron,  who  has  no  interest  and  is  a 
nominal  party  in  the  summons  only  by  an  attempt  to  con- 
fer jurisdiction,  and  is  not  mentioned  in  the  complaint, 
application  for  injunction  or  any  other   paper  in  the  cause. 

III.  The  complaint  is  not  supported  by  the  affidavit  of  the 
plaintiff,  but  by  that  of  his  counsel  and  attorney,  in  an  action 
not  "founded  upon  a  written  instrument  for  the  payinenjt 
of  money  only"  "in  possession  of"  the  attorney,  nor  does  the 
affidavit  disclose  the  attorney's  "knowledge  or  the  grounds 
of  his  belief  on  the  subject,  and  the  reasons  why  it  is  not' 
made  by  the  party,"  as  required  by  law.  Batt.  Rev.  ch.  17 
(C.  C.  P.)  sec.  117.  Indeed  the  restraining  order  has  been 
granted  without  any  legal  affidavit.  State  on  relation  of 
Martin  vs.  Sloan,  69N.  C.  R.  128. 

IV.  It  is  doubtful,  at  least,  if  such  restraining  order  is 
operative  for  more  than  20  days,  while  in  this  case  it  ex- 
tends over  double  that  space.  Batt.  Rev.  ch.  17  (C.  C.  P.) 
sec.  345(5).     Foard  vs.  Alexander,  64  N.  C.  Rep.  69. 

V.  The  order  in  form  restrains  a  public  officer  from  com- 
plying with  the  requirements  of  a  mandatory  statute,  upon 
an  allegation  that  the  statute  was  passed  through  the  Leg- 
islature "  by  fraud  and  deception,"  and  without  the  read- 
ings required  by  the  Constitution  and  thus  seeks  to  impeach 
its  validity  upon  facts  not  appearing  upon  the  records  of  the 
General  Assembly  but  sought  to  be  proved  by  evidence  dehors. 
This  is  not  permissible,  and,  if  allowed,  would  unsettle  all 
laws,  and  leave  their  validity  to  depend  on  the  uncertain  and 
capricious  finding  of  ajury.  Broadnax  vs.Groom,  64 N.  C  Rep. 
244.  In  this  case  the  Court  says,  "  There  can  be  no  doubt 
that  acts  of  the  Legislature,  like  judgments  of  courts,  are 
matters  of  record,  and  the  idea  that  the  'verity  of  the  record' 
can  be  averred  against  in  a  collateral  proceeding  is  op- 
posed to  all  the  authorities.  The  courts  must  act  on  the 
maxim,    'Omnia  presumuntur,'   &c.     Suppose   an    Act  of 


(17 


Congress  is  returned  by  thu  President  with  his  objections, 
and  the  Vice-President  and  the  Speaker  of  the  House  certify 
that  it  passed  afterwards  by  the  constitutional  majority ;  is 
it  open  for  the  courts  to  go  behind  the  record  and  prove  to 
the  contrary  ?" 

It  is  well  settled  law  that  the  court  cannot  enquire  into 
the  motives  of  the  Legislature.  Chief  Justice  Chase,  in  ex- 
parte  McArdle,  Wallace,  513.  C.  J.  Marshall  in. Fletcher 
vs.  Peck,  6  Cranch  87.  Sunbury  and  Erie  R.  R. 
Co.  vs.  Cooper  33  Penn.  St.  Reports.  Exparte  Newman  9 
Cal  503.  Baltimore  vs.  State  15  Md.  376.  Johnson  vs  Hig- 
gins  3  Met  (Ivy.)  566.  "The  courts  can  not  impute  to  the 
Legislature  any  other  but  public  motives  for  their  acts." 
People  vs.  Draper  15  N.  Y.  545.  "  The  Court  cannot  usurp 
the  inquisitorial  office  of  enquiry  into  the  bona  fides  of  the 
Legislature  in  discharging  its  duties,"  Shankland  J.  in 
same  case. 

"The  powers  of  these  departments  are  not  merely 
equal;  they  are  exclusive  in  the  duties  assigned  to  each. 
They  are  absolutely  independent  of  each  other.  It  is  now 
proposed  that  one  of  the  three  powers  shall  institute  an  in- 
quiry into  the  conduct  of  another  department  and  form*  an 
issue  to  try  by  what  motives  the  Legislature  were  governed 
in  the  enactment  of  a  law.  If  this  may  be  done,  we  may 
also  enquire  by  what  motives  the  executive  is  induced  to 
approve  a  bill  or  withhold  his  approval.  To  institute  the 
proposed  inquiry  would  be  a  direct  attack  upon  the  inde- 
pendence of  the  Legislature  and  a  usurpation  of  power  sub- 
versive of  the  Constitution."  Wright  vs.  Defrees  8  Ind.  302. 
The  acts  of  the  supreme  power  of  a  country  must  be  consider- 
ed pure  for  the  same  reason  they  are  considered  just,  because 
there  is  no  power  to  declare  them  otherwise. — Fletcher  vs. 
Peek  and  Crank,  87,  above  cited. 

VI.  The  act  impugned  is  but  a  recognition  of  a  distinct 
previous  obligation  contracted  in  the  very  statute  under 
which  the  exchange  of  bonds  was  made,  and  declared  by  the 


(IS) 

Supreme  Court   to  be   binding  on  the  State.     Raleigh    and 
Augusta  Air  Line  R.  R.  Co.  vs.  Jenkins  68  N.  C.  502. 

VII.  The  bonds  which  are  authorized  to  be  received  un- 
der this  act,  were  issued  by  authority  of  laws  in  force  pre- 
vious to  the  war  and  in  pursuance  of  public  policy  in  re- 
gard to  works  of  Internal  Improvements,  and  their  validity 
is  recognized  in  the  recent  funding  act,  and  they  are  rated  at 
the  value  of  the  very  bonds  issued  in  exchange  for  those  of 
the  Railroad.  Laws  of  North  Carolina  1874-5,  Chapter  175,' 
page  204. 

VIII.  The  injunction  attempts,  upon  allegations  only  ap- 
plicable to  the  act  known  as  House  Bill  422  to  annul  the  orig- 
inal contract  of  the  State  as  adjudged  by  the  Supreme  Court, 
and  to  restrain  the  Treasurer  from  obeying  the  mandates  of 
an  unim  peached  law,  and  whose  validity  has  heretofore  been 
sustained  by  the  Supreme  Court,  Raleigh  and  Augusta  Air 
Line,  68  North  Carolina  Reports,  502. 

IX.  The  Injunction  order  gives  more  even  than  is  asked 
for  in  the  complaint  and  restrains  the  Railroad  from  pay- 
ing in,  and  the  Treasurer  from  receiving,  any  bonds  of  any 
class. 

X.'  The  Court  takes  Judicial  notice  of  the  Journals  of  the 
Legislature,  Cooley  on  Cons.,  Limitations,  page  135,  and  cases 
there  cited.  This  record  like  all  records  can  not  be  collat- 
erally impeached.  The  Journals  of  the  Legislature  show  that 
the  Bill  was  read  three  times  ineach  House,  duly  engrossed 
and  ratified.  House  Journal  1874-5  pages  304,  758  and  776 
and  Senate  Journal  1874-5  pages  642,  646  and  659. 

XI.  The  allegation  that  the  mortgage  bonds  are  worth 
90  cents  to  $1.00  in  the  dollar  is  untrue  By  the  ordi- 
nance of  Convention  March  11th,  1868,  authorizing  the 
deposit  of  the  bonds  they  are  held  as  collateral  security, 
and  can  not  be  put  on  the  market  at  any  price.  They  are 
not  negotiable  or  saleable. 

XII.  The  Court  can  judicially  see,  that  the  allegation 
that  they  are  first  mortgage  bonds  (upon  which  is  predica- 


19) 


ted  one  of  th©  reasons  for  calling  the  act  fraudulent)  is  erro- 
neous. By  an  act  entitled  an  "  aet  to  enable  the  Chatham 
Railroad  Company  to  complete  its  Road"  ratified  April,  10, 
1869,  the  State's  mortgage  was  made  a  second  mortgage. 

XIII.  If  the  act  in  question — House  Bill  No.  422 — was 
stricken  from  the  Statute  book,  it  would  not  alter  the 
right  to  exchange  these  bonds.  That  right  exists  indepen- 
dently of  this  Statute,  by  virtue  of  the  original  contract 
i.  e.,  ordinance,  March,  11th,  1868,  authorizing  the  repay- 
ment of  "  any  valid  indebtedness  of  the  State,"  and  the  act 
of  March,  17th,  1875,  to  "  compromise  the  State  Debt,"  which 
recognizes  the  Internal  Improvement  Bonds,  as  valid  in- 
debtedness. Upon  a  suggestion  therefore  against  "  House 
Bill  No.  422,"  only,  the  restraining  order  has  been  given 
against  rights,  existing  by  reason  of  other  statutes.  House 
Bill  No.  422  has  conferred  no  right  or  power,  not  already 
existing,  by  reason  of  other  and  unimpeached  statutes. 

XIV.  The  validity  of  the  Internal  Improvement  Bonds 
have  been  recognized  by  no  less  than  six  other  acts,  besides 
House  Bill  422  to  wit : 

Ordinance  of  Convention,  '65-'66,     Chap.    11,  page  19. 
Acts  of  1865.  Chap.     3,  page    4. 

Acts  of  1866.  Chap.   37,  page  95. 

Acts  of  1866-  '67.  Chap.  106,  page  177. 

Acts  of  1868.  (special  session)  Chap.  32,    page  44. 

Acts  of  1874-75.  Funding  Act. 

XV.  The  irregularities  in  the  papers  are  great.  The 
summons,  complaint,  and  bond  for  costs,  filed  in  the  cause, 
each  presents  different  parties  defendant. 

XVI.  The  order  of  the  Judge  to  show  cause  why  a  Per- 
petual Injunction  should  not  issue  at  Chambers  is  irregular. 
It  is  not  in  accordance  with  the  old  or  the  new  system. 
Whitehurst  vs.  Green,  69,  North  Carolina,  131. 

XVII.  The  amount  of  the  Injunction  bond  ordered  by  the 
Judge,  $5,000,  is   insufficient,  there  being  several   hundred 


(  20 ) 

thousand    dollars  involved.     Martin    vs.    Sloan,  69  North 
Carolina,  128. 

XVITI.  The  restraining  order  having  issued  without  no- 
tice the  same  may  be  dissolved  without  notice. 

Sledge  vs.  Blum,  63  North  Carolina  Reports  374,  C.  C.P., 
Sees.  195  and  297- 

Respectfully, 

W.  N.  H.  SMITH, 
J.  B.  BATCHELOR, 
T.  C.  FULLER, 
WALTER  CLARK. 


NOTICE    TO    PLAINTIFF     TO     SHOW 
CAUSE. 

On  the  28th  day  of  July  1875,  the  defendants  appeared 
before  Judge  Kerr,  at  Chambers  in  Reidsville,  North  Caro- 
lina, and  through  their  Counsel,  Messrs.  T.  C.  Fuller  and 
Walter  Clark,  moved  to  vacate  the  restraining  order  upon 
the  Plaintiff's  papers,  Avhereupon,  his  Honor  issued  the 
following  notice  : 

North  Carolina — In  the  Superior  Court  of  Orange  County — 
Joseph  Harris,  Plaintiff,  vs.  Raleigh  and  Augusta  Air- 
Line  Railroad  Company,  David  A.  Jenkins,  Public  Treas- 
urer of  North  Carolina,  Defendants. 

On  motion  of  T.  C  Fuller  and  Walter  Clark,  Counsel  for 
the  defendants  in  the  above  entitled  cause,  made  be- 
fore me  at  Chambers  to-day,  in  Reidsville,  in  the  county  of 
Rockingham,  North  Carolina,  to  vacate  or  modify  the  In- 
junction and  restraining  order  heretofore  made  by  me  in  the 
above  entitled  cause :  It  is  now  ordered  that  the  plaintiff 
appear  before  me  in  Greensboro,  North  Carolina,  on  Satur- 
day the  31st  imt.,  at  ten  o'clock,   A.  M.,  and  show  cause  if 


(21) 

any  he  can,  why  defendants'  said  motion  should  not  be  al- 
lowed. 

Let  copy  of  this  order  be  served  on  the  plaintiff  and  the 
original  returned  before  me  on  that  day,  July  28th,  1875. 

(Signed,)  JOHN  KERR, 
Judge  7th,  Judicial  Distrsct. 


This  was  endorsed  : — 

"To  hand  and  served  by  leaving  copies  with  plaintiff 
Joseph  Harris  and  Josiah  Turner,  Att'y.,  this  29th  day  of 
July  1875. 

(Signed,)  S.  M.  DUNN,  Sh'ff, 

By  J.  K.  Dunn,  Dep'ty  Sh'ff. 


ORDER   VACATING  RESTRAINING   OR- 
DER. 

At  10  A.  M.  July  31,  1875,  the  defendants  appeared  by 
their  Counsel  T.  C.  Fuller  and  Walter  Clark,  before  Judge 
Kerr,  at  Chambers  in  Greensboro.  Josiah  Turner,  Esq., 
appeared  for  the  Plaintiff  and  asked  till  4  P.  M.  to  procure 
additional  counsel  and  look  up  his  authorities  which  was 
granted.  At  4  P.  M.  the  cause  came  on  for  hearing  before 
his  Honor  and  after  hearing  Counsel  at  length  on  both 
sides  his  Honor  rendered  his  final  order  in  the  cause 
vacating  the  restraining  order,  refusing  an  injunction  till 
the  hearing  and  giving  defendants  leave  to  sue  upon  the 
Injunction  Bond. 


(22) 

North  Carolina — Guilford  County,  At  Chambers  Greens- 
boro, N.  C,  July  31.,  1875,  before  his  Honor  -Judge  Kerr, 
7th  Judicial  District. 

Joseph  Harris  vs.  David  A.  Jenkins,  Public  Treasurer,  &c, 
The  Raleigh  and  Augusta  Aii-Line  Railroad  Company. 

On  motion  of  Walter  Clark  and  T.  C.  Fuller  Esqs.,  Coun- 
sel for  defendants  it  is  ordered,  adjudged  and  decreed  by 
the  Court  here  that  the  restraining  and  injunction  order 
heretofore  issued  in  this  cause  be  vacated  and  dissolved  and 
that  the  injunction  prayed  for  till  the  hearing  of  this  cause 
be  refused. 

Let  this  order  be  filed  with  the  Clerk  of  the  Superior 
Court  of  Orange  county  where  this  action  is  pending. 

And  it  is  further  ordered  by  the  Court  that  the  Defen- 
dants have  leave  to  institute  suit  upon  the  Bond  given  by 
the  Plaintiff  in    obtaining   the  restraining   order   in   said 

cause  above  entitled. 

(Signed,)  JOHN  KERR, 

Judge  7th  Judical  District. 


THE  KIND  OF  "TAX-PAYER"  THE  PLAINTIFF  IS— 
CERTIFICATE  OF  SUPERIOR  COURT  CLERK  OF 
WAKE  COUNTY. 

Superior  Court,  Wake  County. — I,  John  N.  Bunting,  Clerk 
of  the  Superior  Court  in  and  for  said  County,  do  hereb}^ 
certify  that  Joseph  Harris  was  indicted  for  "Failure  to  list 
Poll"  at  January  Term,  1875,  of  Wake  Superior  Court,  and 
that  said  indictment  is  still  pending  against  the  aforesaid 
defendant  in  said  Court. 

In  witness  whereof  I  have  hereunto  set  my  hand  and  seal 
of  office  this  20th  July  1874' 

/  Seal  of  1  (Signed,)  J.  N.  BUNTING,     . 

{    Office,    f  Clerk  Superior  Court. 


( 23 ) 
FINALE. 

On  the  2nd  August  1875  the  defendants  brought  their 
action  in  the  Superior  Court  of  Wake  Count}1-  to  recover  of 
the  Plaintiff  and  his  sureties  to  the  Injunction  Bond  the 
sum  of  $5,000  being  the  penalty  of  said  Bond. 

And  may  so  end  every  attack  upon  the  integrity  and 
watchfulness  of  the  Legislature  of  1874-5. 


IVOTE. 

As  a  part  of  the  history  of  the  case,  it  can  be  stated  that  the  plaintiff  is  a 
printer  in  Mr.  Josiah  Turner's  office,  and  resides  in  Kaleigh. 

As  to  the  question  of  "  fraud  and  deception  "  in  the  passage  of  the  act  (if 
it  could  he  inquired  into  by  the  Court.)  see  the  letters  of  Messrs.  McEae, 
Moring  and  Strong,  published  in  the  appendix.  No  allegation  was  ever 
more  entirely  without  foundation. 


APPENDIX. 


LETTER  FROM  MAJ.  J.  C.  McRAE,  MEMBER  FROM 
CUMBERLAND. 

Maj.  J.  C(  McRac,  Fayetteville,  N.  C. : 

Dear  Sir : — At  a  meeting  of  the  citizens  of  Wake  county 
a  committee  of  twenty  tax  payers  were  appointed  to  enquire 
into  the  histor}'  of  the  passage  of  the  Act  on  page  328  of  the 
late  Acts  of  the  General  Assembly,  exchanging  mortgage 
for  depreciated  State  bonds.  Will  you  be  kind  enough  to 
write  me  what  you  know  of  it,  and  if  3'ou  were  aware  of  its 
passsage. 

And  oblige, 

H.  0.  PARKER, 
Chairman  of  Committee  of  Twenty. 


H.  0.  Parker,  Esq.,  Chairman : 

Dear  Sir : — Upon  my  return  home  after  an  absence  of 
several  days,  I  find  your  postal-card,  and  reply  immediate- 

iy- 

I  refer  you  to  the  lengthy  article  in  the  Daily  News  of 
several  days  ago  as  a  correct  statement  of  the  matter.  Also 
to  the  letter  of  Mr.  Moring,  published  in  the  same  paper  on 
July  7th,  in  which  I  fully  concur.  The  Act  t©  which  you 
refer,  upon  its  introduction  as  a  bill,  was  referred  to  the 
Committee  on  Internal  Improvements  and   was  examined 


(26) 

and  discussed  in  that  committee,  and  was  held  until  the 
bill  providing  for  a  compromise  of  the  State  Debt  had  be- 
come a  law.  If  the  latter  had  not  recognized  as  a  valid 
debt  of  the  State,  bonds  issued  during  the  war  in  pursuance 
of  acts  before  the  war,  the  committee  would  have  reported 
adversely  upon  the  bill  in  question.  But  the*e  State  bonds 
being  recognized,  as  they  ought  to  have  been,  the  case  was 
this :  the  R.  &  A.  A.  L.  R.  Co.  was  authorized  to  withdraw  its 
own  bonds  from  the  State  Treasury  upon  returning  to  the 
Treasury  in  lieu  thereof  coupon  bonds  of  the  State;  the 
Legislature  had  already  recognized  the  bonds  proposed  to 
be  exchanged,  and  had  gone  further,  it  had  put  these 
bonds  exactly  upon  the  same  footing  as  the  State  bonds 
which  had  been  issued  in  exchange  for  the  Mortgage 
bonds  of  this  Railroad  company.  Was  there  any  objection 
to  the  Legislature  directing  the  Treasurer  to  accept  these 
bonds  ?  Would  it  have  been  honest  in  the  State  to  have  said 
to  this  company,  it  is  true  when  you  gave  us  your  bonds  in 
exchange  for  ours  we  agreed  with  you  that  at  any  time  be- 
fore the  maturity  of  your  bonds  you  might  take  them  up  by 
depositing  in  the  Treasury  a  like  amount  of  our  coupon 
bonds  or  other  indebtedness;  it  is  true  that  we  consider  the 
bonds  which  you  now  offer  as  equal  in  dignity  and  value  to 
the  bonds  which  you  received  from  us,  but  because  we  have 
set  a  value  upon  our  own  bonds  which  is  below  that  which 
you  are  making  yours  worth  by  the  expenditure  of  more 
money  than  the  security,  we  break  the  solemn  contract 
made  with  you  and  we  refuse  to  make  the  exchange. 

I  think  that  I  had  the  interest  and  the  honor  of  the  State 
as  much  at  heart  as  the  Hon.  Josiah  Turner  or  any  one 
else.  I  know  that  the  other  gentlemen  on  the  Internal 
Improvement  Committee,  gentlemen  of  experience  and  in- 
tegrity, are,  to  say  the  least,  just  as  honest  and  just  as  vigi- 
lant as  Mr.  Turner,  and  if  there  had  been  in  this  matter  any 
attempt  to  swindle  the  State,  they  would  have  recognized  it 
and  would  have  rebuked  it  in  fitting  terms  before  the  House. 


(27) 

I  know  of  the  passage  of  the  bill,  I  voted  for  it,  I  would 
do  it  again,  and  any  assertion  of  undue  influence  used  to 
obtain  its  passage  is  simply  a  slander. 

Yours  truly, 

JAS.  C  McRAE. 


CARD    FROM  JOHN  M.    MORING,    MEMBER   FROM 
CHATHAM. 

Editor  News : 

Dear  Sir: — I  herewith  hand  you  a  copy  of  a  communica- 
tion sent  to  Raleigh  Sentinel  which  you  will  please  publish 
and  oblige, 

Yours,  &c, 
JOHN  M.  MORING. 


Hon.  Josiah  Turner  : 

Dear  Sir : — I  see  in  the  columns  of  the  Sentinel  for  the 
last  few  weeks,  a  series  of  editorials  concerning  H.  B.  422, 
"  A  bill  to  be  entitled  an  act  explanatory  of  certain  acts  and 
to  enable  parties  holding  bonds  of  the  State  issued  for  In- 
ternal Improvements  under  acts  passed  prior  to  the  war  to 
sell  the  same,"  which  it  appears  to  me  are  based  upon  a 
misapprehension  and  calculated  to  do  myself,  the  introdu- 
cer of  the  bill,  as  well  as  the  entire  body  of  the  last  Legisla- 
ture, an  injustice.  I  therefore  beg  leave  to  make  a  state- 
ment of  the  facts  in  the  case,  together  with  a  history  of  the 
passage  of  the  bill  in  the  House,  as  concisely  as  I  may  be 
able ;  and  ask  that  you  give  it  a  place  in  your  columns. 

You  have  stated  correctly  that  the  ordinance  of  Convention 
of  March  1868,  which  authorized  the  issuing  of  one  million 


(28) 

two  hundred  thousand  dollars  of  bonds  of  the  State  to  the 
Chatham  Railroad  company  in  lieu  of  a  like  amount  of 
mortgage  bonds  of  said  Railroad,  also  provided  that  the 
company  might  at  any  time  before  maturity  take  up  its 
bonds  deposited  with  the  Public  Treasurer  by  substituting  in 
lieu  thereof  coupon  bonds  of  the  State  or  other  indebtedness  of  the 
State. 

Under  this  provision  of  their  charter  you  say  that  the 
Raleigh  and  Augusta  Air  Line  Railroad  Company  sought 
to  take  out  of  the  Treasury  its  bonds  and  put  in  "  repudi- 
ated war  bonds  "  (meaning  the  bonds  authorized  to  be  ex- 
changed by  H.  B.  422)  that  the  Treasurer  refused  and  that 
the  Supreme  Court  sustained  him. 

In  this  you  are  mistaken,  and  if  you  will  refer  to  the  68 
North  Carolina  Reports,  pages  499  and  502,  you  will  see 
that  in  the  only  two  suits  ever  had  between  'the  said  rail- 
road and  the  Treasurer  it  is  decided  : 

1st.  That  the  Treasurer  is  not  bound  to  take  any  bond  is- 
sued after  the  date  of  said  ordinance  of  March  11,  18G8, 
which  will  embrace  all  the  special  tax  bonds. 

2d.  That  the  Treasurer  is  bound  to  receive  in  lieu  of  the 
bonds  of  the  railroad  any  coupon  bonds,  or  other  valid  in- 
debtedness of  the  State  issued  and  outstanding  prior  to  the 
passage  of  said  ordinance. 

Now  another  remark  as  to  the  facts  surrounding  this  case, 
and  I  have  done  upon  this  point;  and  that  is,  that  the  bonds 
authorized  to  be  exchanged  under  H.  B.  422  are  "  repudia- 
ted war  bonds,"  and  I  would  refer  you  to  the  Act  itself,  (and 
I  would  be  glad  if  you  wTould  publish  it,)  by  which  you  will 
see  that  it  only  authorizes  the  exchange  of  bonds  issued  du- 
ring the  war  for  Internal  Improvement  purposes,  under 
Acts  passed  prior  to  the  war,  (for  detailed  statement  of 
which,  see  Treasurer's  report  for  year  ending  September 
30th  1874,  page  34.)  These  bonds  certainly  could  in  no 
sense  be  said  to  be  issued  for  the  purpose  of  carrying  on  the 
war,  since  they  were  authorized  before  the  war  was  antici- 
pated. 


(  20  ) 

I  will  here  also  state  the  further  fact  that  at  the  time  of 
the  introduction  of  H.  I>.  422 — the  Raleigh  and  Augusta 
Air  Line  Railroad  Company,  had  already  redeemed  from 
out  the  Treasury  about  seven  hundred  thousand  dollars  of 
its  bonds  leaving  remaining  five  hundred  thousand- 
Let  us  now  trace  the  history  of  H.  B.  422  as  it  passed 
into  a  law.  It  was  introduced  on  the  28th  day  of  January, 
nearly  two  months  before  adjournment,  and  was  referred 
to  the  committee  on  Internal  Improvements.  I  had  it  re- 
ferred to  this  committee  because  I  desired  it  to  be  scrutini- 
ze d  (as  indeed  all  acts  should  be,)  and  I  knew  the  compe- 
tency of  the  committee  for  this  work.  The  able  representa- 
tive from  Cumberland,  Maj.  McRae,  was  its  Chairman,  Col. 
Tate,  of  Burke,  also  Chairman  of  Committee  on  Finance, 
Mr.  Oaksmith,  who  had  given  mucJi  time  to  Finance  and 
Railroads,  and  the  no  less  watchful  Patton  and  others, 
formed  this  committee. 

When  the  bill  was  considered  before  the  committee  I  was 
sent  for,  and  stated  all  the  facts  within  my  knowledge  con- 
nected with  it  as  well  as  the  objects  of  the  bill.  The  only 
question  then  arising  as  I  understood,  under  the  decisions 
of  the  Supreme  Court  before  referred  to,  as  well  as  in  right 
was  -whether  the  bonds  issued  during  the  war  for  Internal 
Improvement  purposes  under  acts  passed  before  then  were 
of  the  valid  indebtedness  of  the  State. 

This  question  the  State  Debt  Committee,  of  which  Messrs. 
McRae  and  Tate  and  myself  were  members,  had  before  that 
time  decided  in  the  affirmative.  Owing  to  the  time  the  In- 
ternal Improvement  bonds  issued  during  the  war  were  sold, 
they  had  nearly  all  fallen  into  the  hands  of  citizens  of  this 
State.  Some  of  the  holders  of  these  came  before  the  Com- 
mittee on  State  Debt  and  Liabilities  and  asked  that  their 
claims  be  considered  in  the  adjustment  of  the  debt  of  the 
State,  and  as  that  Committee  were  of  the  opinion  that  when 
our  own  citizens  furnished  the  means  to  build  our  own 
railroads  they  were  as  much  entitled  10  consideration  as  the 


(30) 

bond-brokers  of  New  York,  this  class  of  our  indebtedness 
was  recognized,  as  in  justice  it  ought  to  be,  and  it  so  turned 
out  that  the  bonds  issued  during  the  war  for  Internal  Im- 
provement purposes  under  acts  passed  before  the  war,  and 
the  bonds  issued  to  the  Chatham  Railroad  Company,  which 
H.  B.  422  proposes  to  exchange,  were  placed  in  the  same 
class  in  the  adjustment  of  the  State  Debt,  long  before  H.  B. 
422  was  introduced.  And  indeed  so  far  as  lam  concerned, 
during  a  previous  session  of  the  Legislature,  that  of  1873-'4, 
I  had  introduced  a  bill  to  adjust  and  settle  the  State  Debt, 
and  which  passed  the  House  during  that  session,  embodying 
identically  the  same  classification  as  that  of  last  session. 

The  Committee  on  Internal  Improvements  then,  as  I  un- 
derstood, were  of  the  opinion  that  if  the  State  Debt  bill 
passed,  the  Treasurer  was  authorized  to  receive  the  bonds 
mentioned  in  House  bill  422,  and  that  there  was  really  no 
necessity  for  the  passage  of  that  act ;  and  that  when  such 
exchange  were  made,  if  it  should  be  made,  the  State  would 
receive  exactly  the  same  from  its  debtor,  the  Raleigh  and 
Augusta  Air  Line  Railroad  Company,  as  it  proposed  to  pay 
to  its  creditors,  the  holders  of  the  bonds  issued  to  said  Rail- 
road Company. 

In  accordance  with  this  view,  after  the  State  Debt  bill 
passed,  the  committee  reported  on  the  12th  of  March  (see 
Journal  of  House,  page  657)  that  there  was  no  necessity  for, 
or  objection  to,  the  passage  of  the  House  Bill  422. 

I  did  not  call  the  bill  up,  in  fact  gave  it  no  attention,  as  I 
was  necessarily  absent  some  days  during  that  week  in  at- 
tendance upon  Chatham  Court,  until  some  time  after  my 
return  I  heard  it  announced  as  it  was  regularly  reached 
upon  the  calendar,  was  read  and  failed  to  pass  for  want  of 
a  quorum  ;  then  at  the  request  of  the  gentleman  from  Alle- 
ghany, Mr.  Field,  I  arose  in  my  place,  stated  all  the  facts  in 
connection  with  the  bill,  its  purport  and  intent,  and  it  pass- 
ed by  the  requisite  vote.  It  was  then  engrossed  in  its  prop- 
er order,  sent  to  the  Senate,  and  from  the  character  of  that 


(31) 


body  for  intelligence  and  integrity,  it   passed  that  body   ac- 
cording to  parliamentary  order,  was  enrolled    and  ratified. 

I  regret  it  has  taken  such  length  to  state  the  facts  con- 
nected with,  and  the  history  of  this  bill  to  show  that  there 
was  no  haste,  fraud  or  unfairness  whatsoever  connected, 
with  its  passage  by  a  Democratic  Legislature;  and  further, 
that  when  this  exchange  is  made,  by  the  care  taken  by 
those  whose  duty  it  was  to  guard  her  interests,  the  State 
will  not  be  the  loser  to  the  extent  of  one  cent. 

To  sustain  their  action  in  recognizing  the  validity  of  the 
Internal  Improvement  bonds  issued  during  the  war,  under 
acts  passed  before  by  providing  for  them  in  the  bill  to  ad- 
just the  State  Debt,  the  Legislature  had  the  opinion  of  the 
Attorney  General  Rogers  in  1866,  and  the  action  of  Treas- 
urer Battle  in  funding  the  interest  upon  them  under  act  of 
1866.  And  in  fact  the  only  averment  against  the  validity 
of  these  bonds  that  I  have  ever  heard  was  the  doubt  of 
Treasurer  Jenkins  as  set  forth  in  the  Preamble  of  House 
Bill  422.  I  trust  that  it  will  be  needless  for  me  to  say  that 
it  was  not  my  intention  or  that  of  the  General  Assembly  in 
passing  House  Bill  422,  to  allow  any  one  to  "  rob  the  State"  ; 
and  that  such  cannot  be  the  case  under  the  operation  of  that  bill : 
but  that  a  class  of  our  State  Debt  as  honest  as'any,  and  held 
almost  entirely  by  our  own  people,  might  be  given  a  mar- 
ket value  as  well  as  those  held  by  stock-biokerson  Wall  St.. 
New  York. 

Again  respectfully  requesting   a  publicationof  this  state- 
ment, 

I  am  very  respectfully, 

Yours,  &c., 

JNO.  M.  MORING. 

July  2nd,  1875. 


(32) 

CARD  FROM  GEORGE  V.  STRONG,  ESQ., 

Raleigh,  July  24th,  1875. 
II.   0.    Parker,  Esq: 

Dear  Sir  : — Your  postal  card  of  July  1st  has  been  re- 
ceived. 

It  is  well  known  to  my  friends  that  I  was  often  called 
from  my  seat  during  the  late  session  of  the  Legislature  by 
indispensable  professional  engagements;  and  it  is  well 
known  to  all,  that  during  the  closing  scenes  of  any  Legisla- 
ture much  disorder  and  confusion  prevails.  For  these  rea- 
sons, I  suppose  my  attention  was  not  called  to  the  Act  in 
question,  or  if  it  was,  it  has  escaped  my  recollection. 

It  is  but  right,  however,  to  say,  that  I  have  carefully  ex- 
amined the  merits  of  the  said  Act,  and  have  come  to  the 
conclusion  that  it  is  altogether  just  and  proper,  and  that 
the  State  could  not  either  in  law  or  honor,  refuse  the  ex- 
change of  bonds  therein  provided  for.  She  expressly  con- 
tracted in  the  ordinance  of  March  11th,  A.  D.  1868,  that 
she  would  make  this  very  exchange, and  the  Supreme  Court 
has  decided  in  the  case  of  the  Raleigh  and  Augusta  Air 
Line  Railroad  Company  against  Jenkins,  to  be  found  in  the 
68th  volume  of  the  North  Carolina  Reports  at  page  502, 
that  she  is  compellable  in  law  to  perform  this  contract,  and 
in  that  case  did  compel  her  to  perform  a  part  thereof. 

The  State  under  the  ordinance  above  named  held  twelve 
hundred  thousand  dollars  of  the  bonds  of  the  Raleigh  and 
Augusta  Air  Line  Railroad  Company,  formerly  the  Chat- 
ham Railroad,  and  now  holds  a  large  number  of  them,  as 
an  indemnity  against  a  like  amount  of  her  own  bonds  is- 
sued in  exchange  to  the  road.  She  proposes  to  pay  on  her 
bonds  thus  exchanged  and  those  which  the  road  now  ten- 
ders her,  25  cents  on  the  dollar,  and  if  the  provisions  of  the 
Act  of  which  you  speak  be  not  carried  out,  she  will  collect 
from  the  road  100  cents  on  the  dollar,  thus  taking  one  dol- 
lar for  having  paid  as  surety  twenty-five  cents. 


(33) 

But.  apart  from  the  idea  of  contract,  the  State   should  not 
hesitate  to  do  what  the  Act  provides.     A,  who  is  insolvent, 
has  a  claim  against  B,  who  is  solvent,  and  who  has  a  claim 
against  him  of  the  like  amount.     Could  A,  collect  his  whole 
claim  out  of  B  and  pay  him  only  one  fourth  of  his? 
I  might  give  other  reasons,  but  the   above  will  suffice. 
I  regret  that  so  much  has  been  said  about   this   Act,   be- 
cause so  far  as  I  know  or  have  reason  to  believe,  no  improp- 
er influence  was  used  to  secure  its  passage,  and  because  its 
provisions  meet  my  unqualified    approbation. 
I  have  the  honor  to  subscribe  myself, 
Dear  Sir, 

Your  friend  and 

Ob't  servant, 
GEO.  V.  STRONG. 


TREASURER  JENKINS'  REPLY  TO  G.  H.  ALFORD, 
ESQ.,  CHAIRMAN  OF  THE  LATE  DEMOCRATIC 
MEETING  IN  METROPOLITAN  HALL. 

State  of  North  Carolina,       'j 

Treasurv  Department,      V 

Raleigh,  July  6,  1875.  j 

Green  H.  Afford,  Esq.,  Chairman,  &c,  Raleigh  : 

Dear  Sir — Your  note  accompanying  resolutions  adopted 
by  a  meeting  of  the  citizens  of  Wake  county,  held  in  this 
city  on  the  26th  ult.,  was  received  at  a  time  when  I  could 
not  promptly  respond  as  you  requested,  owing  to  official 
duties. 

The  first  resolution  above  referred  to  is  as  follows: 
"  Resolved,  That  the  Treasurer  be  and  he  is  hereby  re- 
quested to  discontinue  the  exchange  of  the  Mortgage  Bonds 
of  the  Raleigh  and  Augusta  Air-Line  Railroad,  for   the  de- 
preciated bonds  of- the  State." 


(34) 

A  brief  history  of  the  transaction  of  an  exchange  of  bonds 
in  1868  with  the  Chatham  Railroad  Company  (now  Raleigh 
and  Augusta  Air- Line  Railroad  Company)  and  a  statement 
of  reasons  for  my  action  th;  s  far  in  surrendering  the  bonds 
of  the  company,  will  serve  as  an  answer  to  said  resolution. 

An  ordinance  of  the  Constitutional  Convention,  ratified 
11th  of  March,  1868,  entitled  "An  Ordinance  to  amend  the 
charter  of  the  Chatham  Rail  Road  Company,"  directed  the 
Treasurer  of  State  to  deliver  to  the  President  and  Directors 
of  said  campany  the  coupon  bonds  of  the  State  to  an  amount 
not  exceeding  twelve  hundred  thousand  dollars  ($1,200,000) 
for  the  purpose  of  enabling  said  company  to  finish  its  road. 
The  ordinance  further  provided  that  the  Chatham  Railroad 
Company  should  deposit  with  the  State  Treasurer  the 
coupon  bonds  of  the  company  of  same  amount,  date,  &c, 
and  to  secure  the  principal  and  interest  of  which  the  State 
should  have  a  lien  upon  all  the  estate  of  said  company. 

The  requirements  of  the  ordinance  were  complied  with 
on  the  part  of  the  State  and  the  Company  in  an  exchange 
of  bonds  and  the  execution  and  delivery  to  the  State  by 
the  company  of  a  mortgage  on  its  real  and  personal  estate. 

It  should  be  borne  in  mind  that  the  bonds  of  the  company 
were,  in  the  expressed  terms  and  meaning  of  the  ordinance, 
a  deposit  followed  by  a  lien  for  the  security  of  the  same.  The 
Treasurer,  therefore,  held  them  as  a  deposit. 

It  was  also  provided  in  the  same  ordinance — "  that  the 
Chatham  Railroad  Company  may,  at  any  time  before  ma- 
turity, take  up  the  bonds  of  said  Company  deposited  with 
the  Public  Treasurer  by  substituting  in  lieu  thereof  coupon 
bonds  of  the  State  or  other  indebtedness  of  the  State." 

The  General  Assembly,  at  its  annual  session  of  1871-72 
passed  an  act  entitled  "  An  Act  concerning  the  Chatham 
Railroad,  amendatory  of  certain  acts,  and  authorizing  a 
change  of  name"  to  that  of  the  "  Raleigh  and  Augusta  Air 
Line  Railroad  Company,"  in  which  it  was  provided  as  fol- 
lows: 


(35) 

"The  said  Raleigh  and  Augusta  Air  Line  Railroad  Com- 
pany may  at  any  time  hereafter  discharge  the  bonds  of  the 
Chatham  Railroad  Company  deposited  with  the  Public 
Treasurer,  in  the  same  manner  and  not  otherwise, as  the  said 
Chatham  Railroad  Company  is  now  authorized  by  law  to  do 
and  the  Public  Treasurer  is  hereby  directed  to  return  to  the 
said  Raleigh  and  Augusta  Air  Line  Railroad  Company  the 
said  bonds  of  said  Chatham  Railroad  Company  on  pay- 
ment in  the  manner  above  described  until  the  whole 
amount  of  said  bonds  of  the  Chatham  Railroad  Company 
held  by  the  State  shall  have  been  surrendered." 

In  view  of  the  provisions  of  law  authorizing  the  company 
to  take  up  its  bonds  and  '  redeem  its  mortgage,  the  only 
question  for  me  to  consider  was— what  is  State  indebted- 
ness ? 

I  think  on  one  occasion  prior  to  the  decision  of  the  Su- 
preme Court,  January  Term,  1873,  in  the  case  of  Raleigh 
and  Augusta  Air  Line  Railroad  Company  vs.  David  A. 
Jenkins,  Public  Treasurer,  1  was  enquired  of  by  the  Presi- 
dent of  the  company  if  I  would  accept  in  exchange  for  the 
bonds  of  the  company  and  redemption  of  mortgage  (in  con- 
nection with  other  bonds)  the  bonds  issued  for  internal 
improvement  purposes  during,  but  authorized  under  acts 
passed  pior  to,  the  war,  (the  bonds  referred  to  1  presume  in 
the  resolution  transmitted  by  you)  and  my  reply  was  that  I 
did  not  feel  authorized  to  accept  them  in  the  absence  of  any 
direct  legislation  providing  for  their  funding  or  redemption, 
though  admitting  at  the  time  that  the  coupons  of  said  bonds' 
had  been  funded  by  my  predecessor,  Kemp  P.  Battle,  Esq., 
under  the  "  Funding  Act"  of  March  10,  1866,  by  the  advice 
of  the  Attorney  General,  but  basing  my  declension  to  accept 
them  upon  the  fact  that  the  "Funding  Act"  of  August  20th, 
1868,  excluded  them  from  its  operations. 

Reviewing  the  history  of  the  legislation  in  reference  to 
the  State  debt,  I  find  no  statute  plainly  and  unmistakably 
recognizing  the  bonds  in  question   as  indebtedness  of  the 


(36) 

State,  of  equal  validity  with  other  bonds,  until  the  act  of 
17th  of  March,  1875,  entitled  "An  Act  to  compromise,  com- 
mute and  settle  the  State  Debt,"  which  contains  this  pro- 
vision:  "That  when  any  person  holding  and  owning  any 
bond  or  bonds  of  the  State  of  North  Carolina,  issued  in  pur- 
suance of  any  act  of  Assembty  passed  at  any  time  before  the 
twentieth  da}r  of  May  Anno  Domini,  one  thousand  eight 
hundred  and  sixty-one,"  (which  date  embraces  the  bonds  in 
question)  bhall  surrender  and  deliver  such  bonds,  together 
with  all  the  unpaid  coupons  belonging  to  the  same,  to  the 
Treasurer  of  the  State,  then  in  that  case  it  shall  be  the  duty 
of  the  Treasurer,  and  he  is  hereby  required,  to  issue  and 
deliver  to  the  person  so  surrendering  such  bonds  a  new  bond 
of  the  State,"  &c. 

The  following  rates  of  exchange  in  reference  to  the  bonds 
issued  during  the  war  as  referred  to,  are  set  forth  in  the 
Act: 

III.  For  the  bonds  issued  since  the  twentieth  day  of  May, 
Anno  Domini  one  thousand  eight  hundred  and  sixty-one, 
in  pursuance  of  Acts  passed  before  said  last  named  date, 
and  the  bonds  described  in  this  Act  issued  to  the  Chatham 
Railroad  Company,  twenty-five  per  cent,  of  the  principal  of 
the  bonds  so  surrendered." 

It  thus  appears  that  these  bonds  are  placed  at  the  same 
rates  as  the  bonds  given  for  the  Chatham  Railroad  mort- 
gage bonds  in  the  original  exchange. 

Another  Act,  ratified  2nd  day  of  March,  1875,  entitled 
''  An  Act  explanatory  of  certain  Acts,  and  to  enable  parties 
holding  bonds  of  the  State  issued  for  Internal  Improvements 
under  Acts  passed  prior  to  the  war  to  sell  the  same,"  after 
referring  in  a  preamble  to  previous  legislation  in  relation  to 
the  Railaoad  Company  provides  as  follows : 

Sec.  1.  "  That  it  was  the  true  intent  and  meaning  of  the 
Ordinance  and  Act  above  referred  to,  to  authorize  and  em- 
power the  Public  Treasurer  to  receive  any  of  the  aforesaid 
Internal  Improvement  bonds  in  execution  of  the  provisions 
of  said  Act  and  Ordinance. 


Sec  2.  The  Public  Treasurer  be,  and  he  is  hereby  author- 
ized, empowered  and  directed  to  receive  any  of  the  Internal 
Improvement  bonds  of  the  State  of  North  Carolina  herein- 
before described  which  may  hereafter  be  tendered  under  the 
provisions  of  said  Act  and  Ordinance  and  in  execution  of 
the  same." 

It  is  clearly  seen  that  I  have  no  discretionary  power  under 
the  mandatory  provisions  of  Sec.  2  above  given,  but  that  it 
absolutely  requires  of  the  Treasurer,  who  is  a  mere  minis- 
terial offioer,  the  performance  of  a  plain  duty  which  he  has 
not  the  legal  right  to  disregard. 

I  suggest  that  if  the  act  last  above  mentioned  had  not 
been  passed,  the  recognition  of  these  bonds  as  indebtedness 
of  the  State,  by  the  "Funding  Act"  of  17th  of  March,  1875, 
Would  have  given  ample  power  to  the  Treasurer  to  accept 
them  in  an  exchange  with  the  railroad  company. 

I  call  attention  to  the  language  of  the  decision  of  the  Su- 
preme Court,  January  Term  1873,  before  referred  to  in  this 
communication,  "  We  think  it  clear  that  the  Public  Treas- 
urer ought  to  receive  the  State  bonds  issued  in  exchange  for 
the  Chatham  Railroad  bonds,  as  it  was  one  transaction,' 
and  suggest  that  the  Internal  Improvement  bonds  issued 
during  the  war  are  embraced  in  the  same  section  of  the 
"  Funding  Act"  with  the  bonds  issued  to  the  Chatham  Rail- 
road Company,  in  exchange  for  its  bonds  are  of  equal  value 
and  are  directed  to  be  funded  at  the  same  rate. 

I  may  be  pardoned  for  saying,  in  conclusion,  that,  in  the 
discharge  of  my  official  duties  I  have  ever  had  in  view  the 
interests  of  the  State,  and  have  endeavored  to  execute  the 
laws  as  I- understood  them,  or  was  legally  advised  in  refer- 
ence to  them,  and  I  do  not  deviate  from  that  course  in 
obeying  the  statutes  directing  the  exchange  of  bonds  with 
the  railroad  company. 

Very  Respectfully, 

Your  Ob't  Servant, 

D.  A.  JENKINS, 

State  Treasurer. 


(38) 

LETTER  FROM  MAJ.  JNO.  W.  GRAHAM,  SENATOR 
FROM  ORANGE  IN  1870. 

Hillsboro,  N.  O,  July  9th,  75. 
Jno.  D.  Cameron,  Esq.,  Raleigh,  N.  C  : 

My  Dear  Sir: — At  your  request  I  enclose  a  copy  of  a  re- 
port made  by  me  in  relation  to  the  bonds  issued  during  the 
war  for  Internal  Improvements  under  authority  of  Acts 
passed  prior  to  May  28th,  1861.  By  the  contract  made  with 
the  Chatham  Ruilroad  Company  the  State  is  bound,  and  it 
is  ordained,  chap.  XIX.  of  Ordinances  of  Convention  of 
1868,  sec.  3,  "  That  the  Chatham  Railroad  Company  may  at 
any  time  before  maturity  take  up  the  bonds  of  said  Com- 
pany deposited  with  the  Public  Treasurer  by  substituting 
in  lieu  thereof  coupon  bonds  of  the  State  or  other  indebted- 
ness of  the  State."  The  only  question  then  is  whether  the 
State  is  bound  to  make  the  exchange.  I  think  this  too 
plain  for  argument.  It  is  said  in  the  Sentinel  of  the  8th, 
"  It  is  the  exchange  of  bonds  of  which  we  complain  and  not 
that  the  bonds  issued  during  the  war  were  recognized  by  the 
Act,"  (meaning  EL  B,  No.  422.)  My  report  was  to  the  effect 
that  the  Internal  Improvement  bonds  were  a  part  of  the  in- 
debtedness of  the  State.  If  this  is  so,  the  price  the  Chatham 
Railroad  pays  is  not  the  criterion,  as  the  State  did  not  make 
the  exchange  originally  for  purposes  of  speculation  but 
merely  to  hold  an  idemnity  against  future  liability  on  ac- 
count of  the  bonds  issued  by  the  State.  If  these  are  returned 
or  their  equivalent,  the  Treasurer  would  be  compelled  by 
mandamus  to  deliverup  the  bonds  of  the  Chatham  Railroad 
Company  even  if  H.  B.  No.  422  had  never  passed.  Thecaso 
is  precisely  similar  to  that"  of  the  Banks  which  were  char- 
tered in  this  State  before  the  war.  When  they  sue  their 
debtors  and  attempt  collection,  the  debtor  is  allowed  to  buy 
up  the  Bank  notes  and  have  satisfaction  entered  on  the 
judgment  docket.  The  debtor  may  purchase  the  bills  even 
at  one  cent  on  the  dollar  or  after  judgment  is   given.     The 


(39) 

Bank  is  compelled  to  take  its  own  paper,  and  this  is  all  that 
is  required  of  the  State  by  the  exchange  now  being  made. 

Yours,  &c, 

JOHN  W.  GRAHAM. 


REPORT  OF  THE  COMMITTEE  ON  THE  JUDICIARY. 

The  Judiciary  Committee  to  whom  was  referred  the  me- 
morial of  Annie  E.  Henderson,  in  relation  to  certain  bonds 
of  the  State  of  North  Carolina,  issued  under  an  act  of  the 
General  Assembly  of  I860,  chapter  142,  ratified  the  16th  day 
of  February,  1861,  to  her  father,  the  late  Charles  C.  Hen- 
derson, submit  the  following  report:  That  under  the  act  re- 
ferred to,  the  State  of  North  Carolina  authorized  the  issue  to 
the  Wilmington,  Charlotte  and  Rutherford  Railroad  of 
$950,000  in  bonds,  and  by  the  said  act  the  said  company 
was  to  deliver  to  the  State  a  like  amount  of  bonds  of  the  said 
Railroad,  secured  by  a  first  mortgage.  That  the  bonds 
were  not  issued  to  the  said  company  until  July  1st,  1862, 
when  bonds  of  the  company  were  delivered  in  exchange  for 
the  same.  The  committee  upon  examination  of  the  Treas- 
urer's report,  find  that  four  hundred  and  ninety-three 
thousand  dollars  of  the  class  of  bonds  described  by  the  pe- 
titioner, Annie  E.  Henderson,  and  of  which  she  holds  four 
thousand,  are  still  outstanding.  The  committee  think 
proper  to  raise  the  general  question  as  to  the  validity  of  this 
class  of  bonds,  rather  than  to  submit  a  separate  report  upon 
every  case  that  may  hereafter  be  referred  to  them,  as  there 
is  the  same  general  equity  on  the  part  of  the  holders  of  this 
class  of  bonds  to  have  them  recognized.  Four  hundred  and 
fifty-seven  thousand  dollars  of  this  class  of  bonds  have  been 
expressly  recognized  by  the  State  since  the  war,  and  new 
bonds  or  certificates  given  for  the  same,  as  will  be  hereafter 
shown  by  the  committee,  and  the  balance  has  been  brought 


(40 


forward  as  a  part  of  the  public  debt  in  the  Treasurer's  re- 
port. 

The  committee  think  the  debt  was  in  fact  contracted  at 
the  passage  of  the  act  referred  to  in  1861,  before  the  war, 
and  the  issue  or  use  of  the  bonds  was  in  no  way  in  aid  of 
insurrection  or  rebellion,  as  from  the  evidence  which  they 
have  been  able  to  obtain,  they  And  that  a  large  portion  of 
these  bonds  were  paid  out  by  the  company  for  work  done 
before  the  war  commenced. 

Under  the  repeated  decisions  of  our  present  Supreme  Court 
in  regard  to  county  obligations,  there  is  no  question  that 
the  application  of  the  principle  therein  laid  down,  would 
render  the  State  liable  for  these  bonds.  The  committee  also 
have  carefully  examined  the  matter  in  the  light  of  cases  de- 
cided by  the  Supreme  Court  of  the  United  States  in  the  case 
of  Texas  vs.  White,  Chiles  el  al,  and  of  Chief  Justice  Chase 
in  Evans  vs.  city  of  Richmond  in  circuit  court,  and  submit 
the  following  extract : 

EXTRACT  PROM  TEXAS  VS.   WHITE,  CHILES  ET  AL. 

"And  yet  it  is  a  historical  fact  that  the  Government  of 
Texas  then  in  full  control  of  the  State,  was  its  only  actual 
government,  and  certainly  if  Texas  had  been  a  separate 
State  and  not  one  of  the  United  States,  the  new  government 
having  displaced  the  regular  authority,  and  having  estab- 
lished itself  into  the  ordinary  functions  of  administration, 
would  have  constituted,  in  the  strictest  sense  of  the  word,  a 
de  facto  government,  and  its  acts  during  the  period  of  its 
existence  as  such  would  b©  effectual,  and  in  almost  all  re- 
spects valid  ,  and  to  some  extent  this  is  true  of  the'  actual 
government  of  Texas,  though  unlawful  and  revolutionary 
as  to  the  United  States. 

"  It  is  not  necessary  to  attempt  any  definitions  within 
which  the  acts  of  such  a  State  government  must  be  treated 
as  valid  or  invalid.  It  may  be  said,  perhaps,  with  sufficient 
accuracy,  that  acts  necessary  to  peace  and  good  order  among 


(41) 

citizens — such,  for  example,  sanctioning  and  protecting 
marriage  and  the  domestic  relations  governing  the  course 
of  descent,  regulating  the  conveyance  and  transfer  of  proj  - 
erty,  real  and  personal,  and  providing  remedies  for  injuries 
to  persons  and  estates,  and  other  similar  acts  which  would 
be  valid  if  emanating  from  a  lawful  government  must  be 
regarded  in  general  as  valid  when  proceeding  from  actual 
though  unlawful  government;  and  that  acts  in  furtherance 
or  support  of  rebellion  against  the  United  States,  orintended 
to  defeat  the  just  rights  of  citizens,  and  other  acts  of  like 
nature,  must  in  general  be  regarded  as  invalid  and  void." 
State  of  Texas  vs.  White,  <  hiles,  et  al. 

!'  In  the  case  of  Texas  vs.-  White,  Chiles  and  others,  the 
Supreme  Court  held  that  the  acts  of  a  body  exercising  au- 
thority in  an  insurgent  State,  as  a  Legislature,  must  be  re- 
garded by  the  United  States  as  either  valid  or  not,  accord- 
ing to  the  subject  matter  of  legislation.  That  the  Governor, 
Legislature  and  Judges  of  Virginia,  during  the  war,  consti- 
tuted de  facto  government,  nobody  will  question.  They 
exercised  complete  control  over  the  greater  part  of  the  Slate, 
proceeding  in  all  the  forms  of  regular  organized  government.' 
But  then  it  was  a  government  at  war  with  the  United 
States,  and  in  rebellion  against  its  constitutional  authority, 
and  could  not  be  recognized  in  the  national  courts  as  the 
lawful  government,  nor  could  its  acts  be  recognized  as  law- 
ful acts,  so  far  as  these  acts  had  the  effect,  or  were  intended 
to  have  the  effect,  of  overcoming  the  authority  of  the  United 
States  within  the  limits  of  Virginia,  or  of  excluding  that 
authority  from  those  limits.  As  to  regulations  concerning 
marriage,  descents,  conveyance  of  property,  everything  in 
short,  which  belongs  to  ordinary  business  and  the  common 
transactions  of  life,  its  acts  may  be  upheld  as  valid,  but  on 
the  other  hand,  those  acts  which  were  intended  to  give  a 
sanction  to  the  proceedings  of  any  body,  corporate  or  other- 
wise, which  would  have  the  tendency  to  subvert  the  author 
ity  of  the  United  States,  cannot  be  so  regarded. 


(42) 

This  is  the  distinction  laid  down  b}*  the  Supreme  Court 
in  the  case  of  Texas  vs.  White.  Chiles,  et  at,  and  if  we  were 
disposed  to  depart  from  it,  we  should  not  be  at  liberty  to  do 
so.  *  *  *  But  all  this  does  not  touch  the  controlling 
question  in  this  case.  That  question  is,  for  what  purpose 
were  the  notes  issu<  d  ?  Were  they  or  were  they  not  issued 
for  the  purpose  of  aiding  the  rebellion  against  the  govern- 
ment of  the  United  States?"  Evans  and  Evans  vs.  the 
city  of  Richmond. 

When  it  is  remembered  that  the  purpose  for  which  these 
bonds  were  issued  was  to  assist  in  building  a  railroad,  and 
at  the  time  that  purpose  was  formed  the  war  was  not  thought 
of,  it  must  be  plain  that  there  is  no  taint  of  illegality.  If 
after  the  war  commenced  and  the  State  resolved  to  build 
a  road  like  the  Piedmont  Road,  for  the  purpose  of  aiding 
the  war,  the  case  would  be  different. — The  bonds  so  issued 
would  not  be  binding.  But  no  such  purpose  was  contem- 
plated when  the  State  formed  these  obligations. 

The  committee  find  that  by  act  of  1865,  chapter  3,  four 
hundred  and  thirty  thousand  of  these  honds  were  surren- 
dered to  the  State,  and  new  bonds  dated  January  1st,  1866, 
were  issued  to  Wilmington,  Charlotte  and  Rutherford  Rail- 
road Company,  also  that  by  chapter  56.  of  the  laws  of 
1866 — '67,  Heman  H.  Robinson,  surrendered  twenty-three 
thousand  dollars  of  the  bonds  described  and  received  new 
bonds  in  exchange  for  the  same  dated  Januar}^  1st,  1867. 
Also  that  by  chapter  68,  of  laws  1866 — '67,  the  Treasurer  is- 
sued a  certificate  to  the  Literary  Fnnd  for  four  thousand 
dollars  for  bonds  of  the  class  now  held  by  the  petitioner, 
dated  January  1st,  1867,  and  now  part  of  the  recognized 
debt  of  the  State.  The  General  Assembly  of  1866 — '67  also 
by  chapter  50,  authorized  the  Governor  to  appoint  three 
commissioners  to  investigate  the  claims  against  the  State 
and  to  distinguish  between  debts  created  for  lawful  purposes 
and  for  war  purposes.  That  Gov.  Worth,  appointed  J.  C. 
Harper,  Chairman,   and  R.    H.   Battle  and  W.  W.  Husted, 


(43) 

Commissioners  under  said  act.  This  commission  in  their 
report  made  July  21st,  ISO?,  state  "  that  the  question  of  the 
entire  exemption  from  repudiation  of  the  bonds  described, 
as  a  portion  of  the  war  debt  cannot  be  even  debatable.  If 
we  have  any  State  debt  contracted  during  the  war,  that 
may  be  pronounced  entirely  without  stain  or  even  suspi- 
cion, it  is  surely  that  created  by  railroad  bonds  issued  dur- 
ing the  war,  but  under  authority  of  acts  of  General  Assem- 
bly passed  prior  thereto. 

The  Committee  also  find  in  their  examination  that  $200,- 
000  of  bonds,  dated  October  1st,  1861,  were  issued  to  the 
Western  Railroad  Compan}r  under  authority  of  chapter  137 
of  the  laws  of  1860 — '61  in  exchange  for  bonds  of  a  like 
amount  of  that  company,  and  also  that  bonds  to  the  amount 
of  $220,000  were  issued  in  the  Western  North  Carolina 
Railroad  Company,  dated  October  1st,  1861,  under  authori- 
ty of  acts  of  1860 — '61,  chapter,  528,  in  payment  of  stock  in 
that  company.  As  the  two  classes  of  bonds  stand  upon  the 
same  footing  with  those  described  in  the  memorial  of  the 
petitioner,  the  committee  are  of  the  opinion  that  the  State  is 
bound  for  the  same  and  the  new  bonds  should  be  issued  in 
exchange.  The  decision  of  the  Supreme  Court  in  Phillips 
vs.  Hooker,  is  a  settlement  to  the  question  as  to  the  liability 
of  the  State  on  account  of  the  terms  of  the  contract.  Having 
no  doubt  whatever  as  to  the  valid  claim  of  the  holders  of 
the  several  classes  of  bonds  herein  described,  the  committee 
have  instructed  that  the  accompanying  bill  be  reported  and 
recommend  its  adoption. 

JOHN  W.  GRAHAM, 
For  the  Committee. 


(44) 

CARD   OF   THE   BOARD   OF   DIRECTORS   OF   THE 
RALEIGH  &  AUGUSTA  AIR-LINE  R.  R. 

The  attention  of  the  Board  of  Directors  of  the  Raleigh 
and  Augusta  Air  Line  Railroad  Company  having  been 
called  to  the  fact,  that  an  act  passed  by  the  late  General  As- 
sembly has  been  made  the  subject  of  public  discussion,  the 
Board  deems  it  proper  to  submit  the  following  statement  of 
facts  in  relation  thereto : 

The  Chatham  Railroad  Company  was  chartered  by  act  of 
the  Legislature  of  1860-'61.  During  the  war  work  was  com- 
menced on  the  road,  but  no  part  was  completed  for  use. — 
The  Convention  in  March  1808  passed  an  ordinanceauthor- 
izing  the  exchange  of  one  million  two  hundred  thousand 
dollar  State  bonds  with  the  Chatham  Railroad  Company, 
for  a  like  amount  of  its  bonds  for  the  purpose  of  continuing 
the  work  which  had  been  begun  during  the  war.  In  the 
ordinance  it  was  provided,  that  the  company  at  any  time 
before  maturity  might  take  up  its  bonds  deposited  with  the 
Public  Treasurer  "by  substituting  in  lieu  thereof  coupon 
bonds  of  the  State,  or  other  indebtedness  of  the  State."  To 
secure  the  payment  of  these  bonds  by  the  company  it  was 
required  to  and  did  execute  a  mortgage  on  its  road-bed 
property,  &c.  The  State  had  before  the  war  exchanged 
bonds  with  other  companies  on  terms  similar  to  these. 

The  bonds  thus  received  from  the  State  were  sold  by  the 
Company,  and  the  proceeds  used  in  the  construction  of  the 
road.  Several  Amendments  were  made  at  different  times 
to  the  charter  of  the  Company,  and  it  being  its  intention  to 
extend  its  line  by  the  most  direct  and  practicable  rou:e  to 
Augusta,  Ga.,  its  name  was  changed  to  the  Raleigh  and  Au- 
gusta Air  Line  Railroad  Company. 

To  carr}'-  out  this  intention,  and  complete  this  great  work 
it  became  a  matter  of  importance  to  the  Company  to   take 
up  its  bonds  held  by  the  State,  and  to  substitute  thereupon 
coupon  bonds  of  the  State,  which  it  had  the  right  to  do  un 


(45) 

der  the  ordinance  of  the  Convention  above  referred  to,  and 
which  authorizes  the  exchange  of  bonds.  Tn  making  the 
substitution,  the  Treasurer  of  the  State  and  the  officers  of 
the  Company  differed  in  opinion  as  to  what  classes  of  bonds 
the  Company  had  the  right  to  substitute,  and  the  Treasurer 
was  bound  to  receive.  To  obtain  a  construction  of  the  ordi- 
nance above  referred  to.  and  an  Act  of  the  Legislature  in 
relation  to  the  same  subject,  actions  were  brought  by  the 
Company  against  the  Treasurer  which  were  arried  to  the 
Supreme  Court  in  order  that  the  rights  and  duties  of  the 
parties  mignt  be  adjudicated  by  the  highest  tribunal  of  the 
State.  The  decision  of  the  Court  was  in  effect,  that  the 
Company  had  the  right  to  substitute,  and  the  Treasurer  was 
authorized  to  receive  from  the  Company  for  its  bonds,  any 
valid  bond  or  other  indebtedness  of  the  State,  which  had 
been  issued  or  contracted  prior  to  the  passage  of  the  ordi- 
nance above  referred  to,  to  wit:  11th,  March.  1868.  The 
Company  thereupon  p.oceeded  to  deliver  from  time  to  time 
to  the  State  Treasurer,  State  bonds,  the  validity  of  which 
was  not  questioned  and  which  had  been  issued  before  the 
said  11th  of  March,  1868. 

Before  the  late  war  begun  the  Legislature  had  passed  acts 
providing  for  the  issue  of  State  bonds  for  internal  improve- 
ment purposes.  Under  these  acts  bonds  were  issued  to  rail- 
road companies  after  the  war  begun,  but  they  were  not  re- 
garded as  connected  with  the  war  and  were  always  recog- 
nized as  valid.  Under  the  Funding  Acts  of  66,  67  and  68, 
coupons  of  these  bonds  we're  received  by  the  then  Treas- 
urers of  the  State,  to  wit:  (Messrs.  Worth  and  Battle,  one  or 
both  of  them  as  they  are  informed)  and  bond  and  certifi- 
cates of  indebtedness  issued  therefor,  which  were  recognized 
as  valid  by  the  State  and  on  the  stock  market;  and  in  the 
act  passed  at  the  late  session  of  the  General  Assembly  en- 
titled, "An  act  to  compromise,  commute  and  settle  the  State 
debt,"  the  original  bonds  and  bonds  issued  for  coupons  thus 
funded  are  recognized  as  valid  and  new  bonds   are  ordered 


(46) 

to  be  issued  for  them  according  to  their  classification.  The 
most  if  not  all  of  these  bonds,  were  held  in  this  and  the 
Southern  States  (as  the  Directors  are  informed)  they  not  be- 
ing recognized  in  the  stock  markets  North  because  the}r  had 
on  their  face  Confederate  States  instead  of  United  States." 

The  Treasurer,  notwithstanding  the  decision  of  the  Court 
which  allowed  the  company  to  deliver  these  bonds\,  as  the 
company  was  advised,  still  hesitated  to  receive  them. 

Under  these  circumstances  it  was  deemed  proper  that 
the  Legislature  pass  ah  explanatory  act  declaring  the  mean- 
ing and  intention  of  previous  legislation  and  in#accordanee 
with  the  decision  of  the  Court,  The  act  now  referred  to 
was  drawn  and  introduced  into  the  Legislature  for  that  pur- 
pose. So  far  as  the  Directors  know  or  believe  there  was 
nothing  secret  in  the  introduction  or  passage  through  that 
body.  It  being  in  itself  right  and  free  from  objection,  they 
suppose  it  was  passed  in  the  usual  course  of  business.  The 
Journal  shows  the  day  of  its  introduction — that  it  was  re- 
ferred to  the  Committee  on  Internal  Improvements,  was  re- 
ported favorably  by  that  Committee  and  passed  its  several 
readings. 

As  a  matter  of  law  these  bonds  being  recognized  b}r  the 
Legislature  as  valid  in  the  act  to  compromise  the  State  Debt 
above  referred  to,  the  Treasurer  was  bound  to  receive  them 
without  any  additional  legislation. 

The  passage  of  this  act  however  cannot  injure  theyState, 
since  it  is  only  additional  recognition  of  the  validit}7  of  the 
bonds  which  ought  never  to  have  been  questioned,  and 
when  paid  into  the  Treasury  the  State  is  benefitted  by 
having  her  debt  reduced  by  the  amount  thus  paid  in.  But 
t  may  benefit  the  holders  of  these  bonds  who  reside  chiefly 
in  the  South  by  giving  them  a  better  opportunity  to  sell  if 
they  do  not  desire  to  fund.  These  bonds  are  of  similar  val- 
ue and  are  placed  by  the  bill  to  compromise  the  State  Debt 
in  the  same  class  with  the  bonds  issued  by  the  State  to  the 
Road. 


(  17) 

A  copy  of  the  act  is  hereto  appended  from  which,  it  will 
be  seen  that  the  whole  purpose  was  declared  in  the  Pream 
ble. 

W.J.  HAWKINS, 
JOS.  B.  HATCH  ELOR, 
P.  C.  CAMERON, 
GEO.  W.  GRICE, 
WALTER  CLARK, 
GEO.  LITTLE, 
W.  W.  CHAMBERLAIN, 

Directors, 
Office  R.  &  A  Air-Line  R,  R,,  1 
Raleigh,  N.  C,  June  30th,  75.  ( 


[Editorial  in  the  Raleigh  Daily  News,  July  3rd,  1875.] 

A  FOOLISH  CRUSADE. 

For  ten  days  or  more  the  Editor  of  the  Sentinel,  true  to  his 
instincts  of  ruin,  has  exerted  himself  by  voice  and  pen  to 
stir  up  some  new  subject  of  commotion  and  draw  to  him- 
self a  renewed  share  of  that  public  consideration  which  he 
is  conscious  is  fast  leaving  him,  and  coming  before  the  pub- 
lic again,  if  not  in  the  role  of  martyr,  at  least  as  the  pecu- 
liar guardian  of  the  public  honor  and  champion  of  its  rights. 
He  has  raised  up  a  dust,  and  so  far  as  the  influence  of  his 
\joice  goes,  may  have  succeeded  in  infusing  some  of  his  own 
erratic  ideas  into  the  minds  of  his  hearers,  and  impressing 
those  who  know  no  better,  with  exalted  notions  of  his  saga- 
city and  wisdom.  Beyond  the  sound  of  his  voice  his  efforts 
have  fallen  still-born,  and  have  enlisted  none  of  the  press  of 
the  State,  except  that  of  the  Radical    party   who  recognize 


(48) 

in  Josiah  Turner  a  fit  instrument  to  help  it  break  down  the 
Democratic  party  of  the  State. 

And  really  this  would  seem  to  be  the  direct  aim  of  Mr. 
Turner,  and  will  certainly  be  the  effect  if  he  should  suc- 
ceed in  inspiring  his  own  hostility  to  the  best  men  of  his 
party,  by  his  arraignment  of  them  for  participation  in  what 
lie  alleges  to  be  glaring  frauds,  and  by  affixing  to  the  Leg- 
islature a  stigma  which  a  Democratic  body  had  been  spared 
at  the  hands  of  its  political  enemies. 

What  is  the  charge  so  noisily  rung  on  the  public  ear?  It 
is  that  the  Augusta  Air  Line  Railroad  is  engaged  in  an  op- 
eration through  which,  by  the  exchange  of  worthless  bonds 
for  valid  ones  which  the  company  forces  the  Public  Treas- 
urer to  deliver  for  its  own  invalid  ones,  it  will  swindle  the 
State  of  a  million  and  a  half  of  dollars  ;  and  that  the  Legis- 
lature of  North  Carolina,  a  body  which  up  to  this  time  had 
been  honored  by  the  whole  State  for  its  incorruptible  integ- 
rity, had  suffered  itself  to  be  corrupted  or  to  act  under  undue 
influences,  and  thus  passed  an  act  by  which  a  scheming 
corporation  was  empowered  to  swindle  the  State  to  the  ex- 
tent charged  by  the  editor  of  the  Sentinel. 

What  was  the  act  of  the  rail  road  Company  that  has  been 
the  origin  of  such  grave  charges?  It  was,  that  under 
assumed  authority  of  law,  it  had  exchanged  bonds  of  the 
State  in  its  possession,  for  its  own  mortgage  bonds  held  by 
the  Treasurer  of  the  State. 

Now  let  us  see  if  it  had  not  trie  right  to  do  so. 

The  Convention  of  1868  to  enable  the  Chatham  Rail  Road 
to  finish  its  road,  directed  the  State  Treasurer  to  issue  State 
oonds,  taking  in  exchange  for  them  the  mortgage  bends  of 
the  Company:  but  provided  that  the  Company  might  take 
up  their  bonds  so  deposited  with  the  Treasurer  by  substitu- 
ting bonds  of  the  State,  or  other  indebtedness  of  the  State 
for  them. 

The  Supreme  Court  in  a  case  made  up  between  the  Rail 
Road  and  the  Public  Treasurer  in  order  to    obtain  a  defini- 


( 50 ) 

tion  of  the  bonds  to  be  received,  decided  that  the  Treasurer 
was  bound  to  receive  in  exchange  for  the  Chatham  Railroad 
bonds,  any  coupon  bonds  or  other  valid  indebtedness  of  the 
State — and  says  farther,  "we  take  the  words  of  the  ordi- 
nance, 'coupon  bonds  of  the  State'  to  mean  any  coupon  bond 
of  the  State  then  outstanding,"  that  is  at  the  time  of  the  date 
of  the  ordinance,  March  11th,  1868. 

But  the  point  of  the  charge  of  the  editor  of  the  Sentinel 
is,  that  admitting  the  decision  of  the  Supreme  Court  to  give 
the  necessary  power,  the  Rail  Road  Company  took  advan- 
tage of  it  to  return  to  the  Treasurer  bonds  in  themselves 
worthless,  and  by  the  force  of  secret  or  corrupt  legislation 
forced  him  to  take  them. 

The  class  of  bonds  embraces  those  issued  under  the  Act  of 
1860,  known  as  "  Internal  improvement  Bonds."  These 
bonds  were  issued  under  an  Act  or  Acts  passed  previous  to 
the  war,  but  were  really  not  applied  until  after  hostilities 
began,  and  were  headed  ''Confederate  States,"  instead  of  the 
"  United  States."  After  the  war  this  defect  excluded  them 
from  markets  abroad,  but  as  they  had  been  used  at  home  in 
the  early  period  of  the  war,  they  were  regarded  as  a  valid 
claim  against  the  State. 

Their  validity  was  recognized  by  frequent  acts  of  subse- 
quent legislation  and  in  the  hands  of  the  R.  &  A.  R.  R. 
Company  came  fairly  under  the  definition  of  the  Supreme 
Courts  "  any  bonds  of  the  State"  the  Company  was  author- 
ized to  use  in  exchange  for  its  own  mortgage  bonds.  An 
opinion  of  the  Attorney  Ceneral  Sion  H.  Rogers,  given  in 
1866,  sustained  the  validity  of  these  bonds.  At  the  session 
of  1868,  the  committee  on  claims,  through  its  Chairman, 
Kemp  P.  Battle,  Esq.,  made  a  full  and  clear  report  upon 
various  subjects  of  inquiry,  and  among  other  things  of  these 
very  Internal  Improvement  Bonds.  We  have  only  room  to 
make  the  following  quotation  from  the  Report :  "If  we  have 
any  State  debt,  contracted  during  the  war  that  may  be  pro- 
nounced entirely  without  stain,  or  even  suspicion,  it  is  sure- 


(51) 

ly  that  created  by  the  Rail  Road  bonds  issued  during  the 
war,  hut  under  Acts  of  Assembly  passed  prior  thereto  de- 
signed to  accomplish  high  patriotic  objects  alone,  and 
sought  to  be  carried  out,  with  the  best  views  by  the  most 
useful  spirits  in  all  her  borders."  The  validity  of  these 
bonds  being  shown  and  their  equality  with  others  of  their 
class  being  established,  where  is  the  foundation  for  the  as- 
sertion that  by  the  use  of  those  bonds  in  exchange  for  the 
mortgage  bonds  of  the  Chatham  Road  the  State  lias  been 
swindled  ?  These  bonds  as  well  as  others  were  a  recognized 
charge  upon  the  State.  Apart  from  recognizition  by  decis- 
ions of  the  Courts,  they  were  included  in  the  funding  Act — 
that  for  the  settlement,  commutation  and  compromise  of 
the  State  debt,  and  it  became  as  much  the  duty  as  it  was  the 
interest  of  the  State  Treasurer  to  receive  them  In  receiv- 
ing them  in  exchange  for  the  mortgage  bond.s  of  the  Chat- 
ham road,  he  was  really  decreasing  the  public  debt  by  re- 
tiring so  much  of  its  liabilties.  Every  bond  of  the  class 
embraced  in  the  funding  Act  was  so  much  a  reduction 
of  the  public  debt,  principal  and  interest.  Every  bond  out- 
standing is  so  much  existing  as  an  obligation  of  the  State, 
and  under  this  operation  of  exchange  the  debt  of  the  State 
has  been  diminished  to  the  extent  of  the  outstanding  bonds 
that  have  been  received  in  exchange.  So  far  from  any  loss 
to  the  State  if  it  has  gained  to  that  amount.  For  these 
bonds  whose  validity  has  been  affirmed  by  the  Supreme 
Court  and  by  solemn  Acts  of  legislation  must  not  be  con- 
founded with  the  "special  tax  bonds"  issued  at  another 
period  and  for  far  different  objects  and  which  the  people  of 
the  State  very  justly  determined  to  repudiate.  The  taking 
up  or  retiring  of  any  of  these  valid  bonds  is  so  much  de- 
ducted from  the  indebtedness  of  the  State. 

Mr  Turner  has  had  much  to  say  about  the  haste  or  secre- 
cy with  which  the  "  act  explanatory  of  certain  acts  and  to 
enable  parties  holding  bonds  of  the  State  issued  for  Internal 
Improvements  under  acts  passed  prior  to  the  war,  to  sell  the 


(52) 

same,"  passed  through  the  Legislature,  and  has  intimated 
that  our  silence  on  the  subject  proceeds  from  a  complicity 
in  a  fraud  upon  the  public.  The  intimation  is  as  silly  as  it 
is  malicious.     Our  position  as  Clerk  of  the   House  did  not 

carry  us  out  of  the  lineof  special  duties,  nor  were  we  likely 
to  be  informed  of  designs  which  were  intended,  if  any,  to  he 
carried  through  secretly.  Nor  did  we  feel  called  upon  to 
heed  the  idle  and  causeless  clamor  of  the  editor  of  the  Sen- 
tinel, or  the  call  of  an  irresponsible  committee  to  give  infor- 
mation that  might  be  found  by  reference  to  its  proper 
source. 

In  the  Journal  of  the  House  for  Thursday,  Jan.  28th, 
page  304,  will  be  found  the  introduction  of  the  bill  referred 
to,  "explanatory  of  an  Act,  &c."  Mr.  Moring,  of  Chatham, 
was  its  introducer.  It  was  referred  to  the  Committee  on  In- 
ternal Improvements.  On  page  657,  March  11th,  will  he 
found  the  report  of  the  committee  through  its  chairman, 
Mr.  McRae,  "  reporting  that  there  was  neither  objection  to 
nor  necessity  for,  the  passage  of  the  bill."  At  the  evening 
session  of  Friday,  March  19th  (page  759)  the  bill— H.  B.  422 
came  up  on  its  second  reading,  and  failed  to  pass  for  want 
of  a  quorum.  Mr.  Moring  renewed  the  question  on  the  bill 
on  its  second  reading,  and  It  passed.  Under  a  suspension 
of  the  rules  the  bill  came  up  on  its  third  reading. 

Mr.  Kendall  called  for  the  ayes  and  nays.  The  call  was 
not  sustained,  and  the  bill  was  put  to  a  vote  and  again  failed 
for  want  of  a  quorum. 

The  question  on  the  bill  was  then  renewed. 

Mr.  Lloyd  moved  to  postpone  and  make  the  special  order 
for  the  same  day  at  11  a.  m.  The  motion  was  rejected  and 
the  bill  passed  its  third  reading  and  was  ordered  to  be  en- 
grossed. 

The  bill  was  sent  to  the  Senate  and  came  up  on  its  several 
readings  on  Saturday,  March  20th,  and  by  reference  to  page 
644  of  the  Senate  Journal  it  will  be  seen  that  this,  like  many 
bills  before   the  Senate  at   the  same  time,    was   read  and 


(53) 

passed  the  second  and  third  time,  the  yeas  and  nays  being 
dispensed  with  by  consent. 

On  March  10th  the  bill  to  compromise,  commute  and 
settle  the  State  Debt,  passed  its  final  reading  in  the  House. 
On  the  12th  of  March  Mr.  McRae  made  his  reporrt  on  the 
bill  "  explanatory,  &c,"  the  recommendations  of  which  are 
explained  by  the  provisions  of  the  bill  for  the  settlement  of 
the  State  Debt,  making  further  legislation  to  facilitate  the 
the  sale  or  exchange  of  bonds  useless,  since  the  latter  bill 
gave  all  the  powers  needed. 

It  is  therefore  absurd  to  assert  that  there  should  be  any 
secrecy  or  any  collusion  in  the  passage  of  a  bill  by  which 
not  a  solitary  advantage  was  obtained. 

We  present  below  the  card  of  the  Directors  of  the  Raleigh 
and  Augusta  Air  Line  Road.  Some  names  at  least  can 
escape  the  slurs  of  the  Sentinel  At  any  rate,  they  are  above 
it,  and  a  discerning  public  will  give  more  weight  to  their 
statements  than  to  the  reckless  and  ill  sustained  assertions 
of  one  who  is  working  simply  for  political  capital. 

The  Legislature  needs  no  defence.  Its  purity  and  integ- 
rity are  assailed  for  the  first  time,  and  that  by  one  of  its  own 
party  peculiarly  interested  in  maintaining  and  defending 
its  character.  And  the  public  will  be  very  well  enabled 
to  judge  from  the  above  example  how  little  foundation  there 
is  for  charges,  the  effect  of  which,  if  true,  would  be  as  suc- 
cessful in  the  degradation  of  the  representatives  of  the  Dem- 
ocratic party,  as  were  the  efforts  of  Mr.  Turner  to  fasten  the 
deserved  stigma  upon  those  of  the  other  party  in  times  past, 
when  his  zeal  appeared  really  to  spring  from  patriotic  mo- 
tives. 


(54) 
LETTER   FROM  JUDGE   KERR. 

The  following  is  a  letter  from  Judge  Kerr  commenting 
upon  an  article  in  the  Raleigh  Daily  News,  upon  the  sub- 
ject of  the  injunction  granted  by  him  restraining  the 
State  Treasurer  from  a  farther  exchange  of  bonds  with 
the  Raleigh  and  Augusta  Air-Line  Railroad  Company  : 

Reidsville,  July  21st,  1875. 
To  the  Editors  of  the  News: 

My  attention  has  just  been  attracted  by  an  article  in  your 
paper  of  the  21st,  in  which  an  allusion  offensive  in  charac- 
ter, is  made  to  my  official  aetion  in  the  case  of  Harris  vs.  the 
Public  Treasurer  and  the  Raleigh  &  Augusta  Air-Line  Rail- 
road Company.  Among  other  things  which  you  state  in  the 
article  referred  to,  is  the  following,  viz :  "  We  are  at  a  loss  to 
conceive  the  force  of  arguments  which  induced  Judge  Kerr 
to  lend  himself  ( italicised  by  me,)  to  the  futherance  of  per- 
sonal purposes,   inadvertently  perhaps,   but  not  less  effect- 

II  q  1 1  xr  *  •¥■  •¥  k  *  *  %  *p  % 

The  burden  of  the  attack  falls  upon  the  Legislature  and 
its  bad  effects  upon  the  Democratic  party.  " 

In  the  first  place,  Messrs.  Editors,  I  am  slow  to  believe 
that  an}r  personal  offense  to  myself  was  intended  by  you,  in 
publishing  the  article  referred  to,  but  the  article  is  mani- 
festly offensive  in  its  terms,  and  I  respectfully  ask  that  you 
will  reconsider  your  conclusion  in  regard  to  my  official  con- 
duct alluded  to  by  you. 

Mr.  Harris,  the  complainant,  by  his  Attorney  and  Agent, 
Josiah  Turner,  came  before  me  with  a  complaint  in  due 
form  of  law,  in  which  it  is  alleged,  among  other  things,  that 
a  great  wrong  was  about  to  be  done  to  the  people  of  the 
State,  by  virtue  of  what  purports  to  be  an  act  of  the  Legisla- 
ture of  the  State,  passed  at  its  last  session ;  that  the  said 
supposed  act  of  Assembly,  is  in  fact,  no  part  of  the  law  of 
the  State,  for  that  it  never  received  the  sanction  of  the  two 
Houses  of  the  Legislature,    but  is  in  fact  a    fraud,  having 


(55) 

been    surreptitiously    passed   through    the  Senate,   without 
going  through  the  forms  required  by  law. 

This  was  sworn  to,  and  upon  this  as  well  as  other  allegations 
in  the  complaint,  a  perpetual  injunction  is  prayed  for,  to 
prevent  the  public  Treasurer,  who  is  a  defendant  in  the 
case,  from  making  with  the  other  defendant  the  exchange 
of  bonds,  which  the  supposed  fraudulent  act  authorizes 
Upon  this  showing  of  the  plaintiff,  who  sues  for  himself  and 
for  other  tax-payers  in  the  State.  I  granted  an  order,  that 
"  upon  the  plaintiff's  giving  bond  and  good  security  in  the 
sum  of  ten  thousand  dollars  conditioned  for  payment  of  all 
damages  which  the  defendants  might  sustain  by  reason  of 
the  plaintiff's  wrongfully  suing  out  said  order,"  the  Clerk  of 
Orange  Superior  Court  should  issue  a  summons  to  the  de- 
fendants to  appear  before  me  at  the  next  term  of  Guilford 
Superior  Court,  on  Wednesday  of  said  term,  and  show  cause 
why  an  injunction  should  not  be  granted  as  prayed  for  in 
the  plaintiff's  complaint  and  that  in  the  mean  timethe  pub- 
lic Treasurer  be  restrained  from  making  any  exchange  of 
bonds  with  the  other  defendant,  the  Raleigh  and  Augusta 
Air-Line  Railroad  Company. 

To  my  mind  it  is  very  clear  that  I  was  bound  to  grant 
this  order.  I  judicially  know  nothing  of  the  facts  which 
have  influenced  your  minds  in  regard  to  this  controversy. 
I  am,  as  a  judge,  bound  to  hear  and  determine  all  matters 
brought  before  me,  without  regard. to  what  may  be  the  per- 
sonal character  or  political  relation  of  the  Jparties,  and  I 
should  feel  that  I  had  justly  forfeited  all  claim  to  personal 
respect  and  official  support,  were  I  in  the  least  degree  in- 
fluenced in  my  judicial  actions  by  regard  to  the  effect  those 
actions  might  be  supposed  to  have  upon  either  of  the  polit- 
ical parties,  into  which  the  people  of  our  State  arc  now 
divided. 

In  my  office  as  Judge,  it  behooves  me  not  to  know  any 
man,  either  as  a  friend  or  as  an  enemy,  as  a  political  asso- 
ciate or  political  opponent,  but,  ignoring  all  these  disturb- 


(56) 

ing  forces,  it  should  be  my  earnest  aim  to  administer  the  law 
with  inflexible  justice  to  all,  without  fear  on  the  one  hand 
or  favor  on  the  other. 

Respectfully  yours, 
JOHN  KERR, 


We  need  not  point  out  to  the  professional  reader  that  an 
Act  of  Assembly  is  law,  if  constitutional,  and  that  Judge 
Kerr  erred  in  supposing  that  the  judiciary,  a  co-ordinate 
branch  of  the  Government,  could  go  behind  the  signatures 
of  the  two  speakers  of  the  General  Assembly,  and  at  Mr.  Tur- 
ner's suggestion  of  "  fraud  and  deception ,"  examine  into  the 
motives  which  actuated  the  Representatives  of  the  people. 
For  their  motives  the  members  of  the  Assembly  are  respon- 
sible to  their  God,  their  consciences  and  their  constituents — 
and  to  them  alone.  No  one  doubts  that  the  distinguished 
Judge  did  what  at  that  time  he  deemed  his  duty  and  he 
proved  this  (if  indeed  it  needed  proof)  by  promptly  dissolving 
the  restraining  order  and  dismissing  the  action  when  upon 
examination  he  found  there  was  neither  ground  in  law  or  in 
fact  for  the  charges  made  in  the  complaint. 


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